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New P&R member explains tax change of heart

New P&R member explains tax change of heart

Thursday 09 February 2023

New P&R member explains tax change of heart

Thursday 09 February 2023

The most recently appointed member of the Policy & Resources Committee says his realisation of the true pressures on public finances helped to turn his mind towards the headline tax package.

Deputy Bob Murray, who was elected to the Committee in November following the resignation of Deputy Heidi Soulsby, was speaking to the media as P&R laid out a series of options which will be put to the vote next week.

I think from a personal point of view it's probably worth recognisingand I have to put my hands up here, there were two people I think at the end of the green paper who didn't propose continuing with GSTDeputy Liam McKenna and myself.

He laid out three reasons why his position has shifted since P&R pulled its original plans for GST in September 2021.

The first was when I was able to fully understand the extent of the deficit that we're facing at this stage. Because obviously, when you're looking from the outside, not as a States member, you do your best to try and make the best you can out of the accounts, they are quite difficult in places,” Deputy Murray said.

But when it became apparent that Treasury had actually identified that we were talking about 85 million pounds structural deficit, the gig was up there, frankly, at that point, you can't cut your way to 85 million pounds, it's not possible

“Anybody who doesn't believe that we're at an 85-million-pound deficit at this point in time is in complete denial outside of the States and inside of the States."


Pictured: Debate on the Tax Review resumes on February 15. 

Deputy Murray also said he was convinced the package in its entirety is progressive and equitable, particularly for low-income households. 

His final reason was that GST would broaden the tax base, moving away from a reliance on income taxes which make the Bailiwick “very, very, very vulnerable” to economic shocks and demographic changes. 

“Wwould introduce new money that we can't have otherwise. So for example, we will be getting some £6 million coming from tourists that we don't get at the moment. 

But what also I hadn't grasped was, in fact, how alive we were on income-based taxes… this is actually an opportunity for us to disperse that much more readily just in case there's a downturn in the economy, which would hit us very, very hard. 

So, those are the reasons that I decided to back this in the circumstances. And I'm very pleased that I do because I don't think that there's an alternative to this.”

Deputy Peter Ferbrache called on all States members to do what is in the best interest of the islands rather than “what's in the best interest of anybody's political career”.


EXPLAINED: An acceptable way forward?

Tax challengers unconvinced – fresh amendment expected

Deputies warned against opting for "comfort blanket" of delay on tax

Act now on tax call from Ferbrache as States losses mount

"Unacceptable" and "damaging" service cuts if States reject GST

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