The latest entrant to the Jamaica Stock Exchange’s (JSE) Junior market, general insurance provider Key Insurance Limited is slated for listing this morning (Thursday March 31) at 9 a.m tomorrow.
Key will become the 29th company to list on the market which offers freedom from corporate tax payments for the first five years of listing. On April one this regime will expire, leaving new entrants without the tax benefit unless the government decides otherwise.
On Wednesday March 30, ISP Finance Services Limited was listed as the 27th company on the Junior Market after raising J$97.97 million in total from sale of 4 shares.
On March 24 car dealer Jetcon Limited was also listed on the market after meeting its target of $96 million raised by IPO.

On March 15, general insurance start-up Iron Rock Insurance was also listed on the Junior Market. It raised its $315 million in the first IPO of the month.

The corporate incentive benefit for the Junior Market was slashed under recent legislation from 10 to five years, with further plans to phase out the award of tax breaks by the end of this financial year — March 31, 2016.
Under the current JSE Junior Market structure, companies pay no corporation tax for the first five years of listing, after which they pay this tax at the full rate. Companies benefit by using this period to reinvest the tax benefit into revenue-generating and cost-saving activities, and this results in more profits.
It is expected that profits will be redeployed in the business in order to cover the early working capital needs of the company and enhance its growth.
After five years, these companies are projected to increase their annual profits to a level where, when they start paying more than make up for the tax breaks received earlier.