Some wealthy immigrants moving to Jersey under a 1(1)(k) housing licence will pay more taxes in future, after the island’s treasury minister, senator Philip Ozouf, asked the housing minister to hike the minimum contribution from £100,000 (around $157,820) to £125,000 for all new entrants with immediate effect.

In his budget statement, Senator Ozouf also said he intends to introduce a new high value residents regime, which will change the amount these residents are taxed in addition to the minimum contribution.

However, to encourage these residents to structure their investments within Jersey, the treasury minister will propose a simplification of the taxation system on worldwide income. Specifically, he will propose to tax 1(1)(k) residents on the first £625,000 of their worldwide income at a rate of 20 per cent, and 1 per cent thereafter. Currently, the first £1 million of worldwide income is taxed at 20 per cent, the next £500,000 is taxed at 10 per cent, and the rest at 1 per cent.

The changes are part of a wider programme of cost cutting and tax rises to tackle Jersey’s budget deficit.

“We need a simple and competitive tax regime that encourages high net worth individuals to bring their investments and businesses to Jersey,” said senator Ozouf.

Residents living in the island under the 1(1)(k) regime make a large overall contribution to the States’ finances, with around 130 of such taxpayers contributing in the region of £13.5 million per year, according to senator Ozouf.