THE Isle of Man's business tax system will no longer be considered harmful if it goes ahead with its proposed withdrawal of the attribution regime for individuals (ARI).

The EU Code of Conduct Group made the decision, in principle, at a meeting in Brussels yesterday.

The group, which monitors compliance with the EU code of conduct for business taxation, met with officials from the Isle of Man Treasury who assisted the group members with a review.

Staff from the Treasury also agreed to keep the EU group updated in relation to the progress of legislation through Tynwald now that it is clear that the proposal meets the group's requirements.

Treasury Minister Anne Craine has welcomed the news after announcing the abolition of ARI from April 2012 in her budget speech in February this year.

She said: "This is a positive development for the Isle of Man. It is an endorsement of government's strategy of responsible engagement with international concerns while promoting the Island's legitimate interests."

The EU Code of Conduct Group's conclusion is subject to formal confirmation by the EU's Economic and Financial Affairs Council in December.