THE House of Representatives on Tuesday gave final approval to a Bill amending the Income Tax Act, to allow for the tax benefits to continue for those companies listed on the Junior market of the stock exchange.

There were fears, up to early this year, as to whether the previous Government would approve a continuation of the benefits offered to listed firms by the Jamaica Stock Exchange, despite assurances from former minister of finance, Dr Peter Phillips, that the then Government “would do everything to facilitate its continuation”.

Despite the assurance, Dr Phillips had admitted that the then Government was reviewing the entire range of issues in determining what could be done to incentivise the listing of private companies on the stock exchange. He also promised to report to Parliament on the outcome of those deliberations during the 2016/17 budget debate. However, the February 25 general election intervened.

On assuming office in March, current minister of finance and the public service, Audley Shaw, who was responsible for introducing the Junior Market in 2009, reiterated in his pre-election promise to protect the benefits.

Cabinet accepted the proposals, and they were approved yesterday in the House of Representatives.

Shaw has insisted that ,while tax was foregone in the deal, businesses were expanding and statutory deductions were growing significantly.

The new changes repeal the provisions of the seventh schedule of the Act, and replace them with the provisions of the 2009 Remission Notice, which was introduced by Shaw when the Junior Market was introduced. They allow for 100 per cent of the income tax paid by companies listed on the Junior Market to be waived for five years, and a further 50 per cent waiver for another five years, bringing the incentive period to a total 10 years.

Under the new changes, companies benefiting from the preferential tax treatment prior to 2016, including those who received waivers in 2009 and other incentives which came into being in 2014 when the seventh schedule was added, will have their preferential tax treatment maintained as follows:

Companies who received waivers in 2009 and were grandfathered under the 2014 amendments will enjoy their waivers up to 2019, with 100 per cent exemption up to 2014, and the 50 per cent exemption up to 2019.

Those with waivers since 2014, and up to March 2016, under the seventh schedule, will enjoy 100 per cent exemption from income tax up to 2019, or 2021, and after that will be eligible for the 50 per cent exemption after that.

Companies approved as at April 1, 2016 will enjoy 100 per cent exemption from income tax for their first five years in the junior market, and 50 per cent exemption for the second five years as well.

Minister of state in the Ministry of Finance and the Public Service Fayval Williams closed the debate in the absence of Shaw who is off the island.