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Deputy Charles Parkinson - a former Treasury Minister - has come up with an alternative plan for raising revenue, by designing a new Corporate Income Tax (CIT).
The amendment lodged by Deputy Parkinson and seconded by Deputy Liam McKenna, suggests setting up a new committee to be called The Corporate Tax Investigation and Advisory Committee.
Deputy Parkinson wants Deputy Gavin St Pier to join him on that committee, along with two members of the Policy and Resources Committee, and a non States Member.
This committee would work on introducing the CIT on a territorial basis at a general rate of 10% to 15%, which Deputy Parkinson says would raise a minimum of £20million per year.
Pictured: If the States go for the CIT idea, a new committee could be set up to run it.
The island's financial deficit is more than £80million a year, and the proposed goods and services tax is predicted to bring in around £50million a year.
Deputy Parkinson's amendment is aimed at helping the economy to grow, while protecting the finance sector - and indeed improving its reputation in his opinion.
He says in his explanatory note:
"It will therefore provide a strong and stable platform on which to build the island’s economic future and stimulate economic growth. In applying a corporate income tax operated on internationally accepted principles, and with a positive tax rate, the new Corporate Income Tax system will greatly reduce the international hostility towards Guernsey as a territory with a ‘low or zero rate of tax’."
Pictured: Deputy Parkinson has long been an opponent of any plans to introduce a goods and services tax.
If a CIT were introduced in Guernsey, Deputy Parkinson suggests some exemptions including those registered as 'collective investment vehicles', and any capital gains.
Deputy Parkinson said overall his amendment will take some of the burden off residents and spread it more evenly among those who live and work in the island, and the businesses which employ them.
"The new Corporate Income Tax system will ensure that the burden of funding the public services of the island is shared fairly among all of the participants in Guernsey’s domestic economy. In doing so, some of the fiscal pressure on the population of resident individuals will be alleviated, making Guernsey a more attractive place to live and work for the young people of the island and for those contemplating taking up employment on Guernsey."
Pictured: Deputy Parkinson's amendment is due to be explained at a public meeting on Monday night.
Deputy Parkinson is holding a meeting on Monday night where he will present his amendment to the public.
It will then be debated alongside the P&R proposals to overhaul the tax and social security systems later this month.
At least one further amendment is expected to be lodged next week offering another alternative to P&R's plans.
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