Finance Minister Fayval Williams has accepted the JSE’s proposal to determine a micro market. (Picture: Naphtali Junior)
Almost 16 years after the Jamaica Inventory Alternate (JSE) Junior Market was fashioned, Finance Minister Fayval Williams has introduced that she has accepted the JSE’s proposal to determine a JSE Micro Market.
Minister Williams made the announcement yesterday throughout her price range speech in Parliament the place it was confirmed that this market would facilitate micro, small, and medium enterprises’ (MSMEs’) capability to boost fairness capital between $10 million and $50 million. A technical working committee will likely be fashioned with representatives from the Ministry of Finance & Public Service, JSE, Corporations Workplace of Jamaica, the authorized fraternity, the Securities Sellers’ Affiliation, and the Non-public Sector Organisation of Jamaica (PSOJ).
“We absolutely anticipate {that a} absolutely functioning micro market will put construction to extra companies in Jamaica for sustainability and progress and entry to fairness capital. We’ll start these conferences of the technical working committee as quickly as we begin the brand new fiscal yr,” the finance minister said in her price range speech.
Minister Williams talked about that the JSE, via Marlene Avenue Forrest, the outgoing managing director of the JSE, had recognized 250 micro and small companies which might be in want of fairness capital funding and had been moderately organised, however had been unable to go public on the JSE’s Predominant and Junior markets as they weren’t on the degree of accounting or reporting necessities to go public. This was additionally compounded by the problem the place many don’t require $50 million in collaborating fairness capital which is the minimal quantity that firms on the JSE Junior Market are required to have after itemizing.
Thus, the JSE Micro Market is a proposed different to facilitate the flexibility for smaller firms to boost fairness capital and help their progress initiatives.
“And Madam Speaker, simply in case anybody tries to say they had been first with this concept of the JSE’s Micro Market, let me remind them that I spoke on the 2025 JSE convention in January, forward of the Opposition, and publicly said this Authorities’s intention to work with the JSE to determine the Micro Market. I’m transferring now to formalise that course of to take the Micro Market to a launch date,” Minister Williams added.
The JSE Junior Market was fashioned in April 2009 with Entry Monetary Providers Restricted changing into the primary firm to go public on this market that October. This market allowed for firms to boost between $50 million and $500 million in a public market provide like a prospectus situation or a proposal on the market and be listed on the JSE. Corporations that listed on this market additionally profit from a 10-year tax remission the place they pay no earnings tax for the primary 5 years after being listed and pay 50 per cent on the traditional charge for the remaining 5 years. Corporations should stay listed on the JSE for 15 years and never be suspended by the JSE to ensure that the tax authorities to not be capable of claw again any of the remitted earnings tax advantages the businesses would have acquired through the years.
In keeping with information composed by Minister Williams during the last 5 years, firms listed on the Junior Market paid $1 billion in statutory funds, $1.6 billion basically consumption tax and $1.6 billion in PAYE (pay as you earn) earnings taxes. The variety of new workers ensuing 2009-2024 was said to be 40,511 individuals. Additionally, it was said that the overall capital raised throughout all the businesses and traders between 2009-2024 was $20.2 billion.
As of March 11, 2025, the Junior Market’s market capitalisation was $141.35 billion with the Junior Market Index at 3,560.20 factors. A complete of 55 firms have listed on the JSE Junior Market since 2009 with six graduating to the Predominant Market and two delisting from the JSE. Nevertheless, whereas Sweer River Abattoir & Provides Firm Restricted was delisted in February 2020 for quite a few rule breaches, tTech delisted on February 28 after the corporate’s majority shareholders purchased greater than 80 per cent of the strange shares because it sought to take it personal. There are at present 47 firms listed on the JSE Junior Market with one other one to probably checklist within the coming weeks. Atlantic {Hardware} & Plumbing Firm Restricted, an organization chaired by Paul Barnaby Scott, is at present engaged in its preliminary public providing (IPO) with the provide set to shut tomorrow.
An modification to regulate the share capital restrict for Junior Market Corporations from $500 million to $750 million was launched in parliament in January with the Revenue Tax Act modification invoice being handed within the decrease home. Prime Minister Andrew Holness famous on the JSE’s latest Capital Markets convention that the Senate or Higher Home was set to debate the invoice on January 24, however there was no additional public info on the place that Invoice has reached. Some Junior Market firms are at present ready on that adjustment to checklist their subsidiaries on the Junior Market.
One extra announcement was the discount of the withholding tax charges on dividends paid to non-treaty tax resident firms and people from 33 1/3 per cent and 25 per cent, respectively, to fifteen per cent. This may successfully equalise the withholding tax charge utilized on dividends to fifteen per cent which is similar charge utilized to particular person Jamaican tax residents and company Jamaican tax residents. Nevertheless, the adjustment wouldn’t have an effect on any treaty charges already in place reminiscent of with Caricom (Caribbean Group) which ends up in no withholding tax being utilized by resident tax firms in a single Caricom territory paying tax residents/firms of one other Caricom territory. Which means S.B.D. LLC, a Delaware subsidiary owned by Seaboard Company, which owns 21 per cent of Kingston Wharves Restricted (KW) would have seen its tax charge lower from 33 1/3 per cent to fifteen per cent if KW dividends had been nonetheless taxed.
“This profit is one approach to say to these Jamaicans who’ve firms overseas, in jurisdictions with decrease dividend tax charges than our 33 1/3 per cent for non-resident firms and 25 per cent for non-resident people, we’re reducing the speed for you. Deliver your capital again to Jamaica,” Fayval said with fervour.
Regardless of these wins for home and international companies, the native monetary sector should proceed to bear with the 0.25 per cent asset tax for an extra interval. The asset tax is an annual tax charged on the taxable property of a regulated entity which has both the Financial institution of Jamaica or Monetary Providers Fee as their main regulator.
“Madam Speaker, in all our contemplations, now we have to have interaction with the monetary sector across the vexed situation of the asset tax which they had been informed by the opposite aspect could be non permanent. Some concepts have come to me from the monetary sector on how we might start to scale this again,” Williams said.
Williams’s announcement on discount in withholding taxes on dividends come virtually two months after Prime Minster Holness talked about a attainable discount in these charges in his bid to draw capital again to Jamaica. That is a part of a larger initiative to modernise the enterprise laws and regulatory framework to place Jamaica as a world enterprise and monetary companies hub. The prime minister talked about Partnership Basic Act, Partnership Restricted Act, Trusts Act Belief and Company Providers Suppliers Act and Segregated Accounts Corporations Act (SACs) throughout his speech on the JSE Capital Markets Convention. He famous that the Trusts Act and Trusts and Company Service Suppliers Acts had been operational, however amendments had been being made to the Partnership Restricted Act to adjust to FATF (Monetary Motion Process Pressure) suggestions. The SAC’s Act was handed in 2024 and is awaiting gazettement. The Restricted Legal responsibility Firm (LLC) Act is the ultimate piece of laws to be launched.
