Tax debate hots up as deputies face the public

Wednesday 04 January 2023

Deputies from all sides of the tax debate are lining up to make their cases to the public.

Policy & Resources plans for reform include a controversial move to introduce a GST.

They will face challenges in the Assembly, with the first of those confirmed this morning when former Treasury & Resources minister Deputy Charles Parkinson announced a public meeting about his amendment, seconded by Deputy Liam McKenna.

That will focus on corporate tax reform as an alternative to a GST - Deputy Parkinson has argued in favour of a territorial corporate tax system instead of the current zero-10 arrangements to raise more revenue.

His amendment should be published later this week, but before that he announced a presentation at St. Pierre Park Hotel at 18:00 on Monday 16 January. 

Free tickets are available through Eventbrite.

Say No to GST - the Parkinson/McKenna amendment. There will be a presentation at the St Pierre Park Hotel at 6.00pm on Monday 16 January (until 7.30). Tickets are free but spaces are limited. Book yours on Eventbrite

— Charles Parkinson (@dep_parkinson) January 4, 2023

P&R has also announced a series of public engagement events.

“What the States decide in its January debate on the Tax Review will have major consequences for the community for many years to come,” said P&R President Deputy Peter Ferbrache.

“But we fully recognise this is a difficult decision and many Islanders have concerns. The solutions are not simple, and we want to give as much time as possible to answering questions and explaining how we’ve come to these recommendations.”

Pictured: Deputy Peter Ferbrache.

At 19:00 on Tuesday 10 January there will be a live Facebook Q&A with members of the Policy & Resources Committee and Tax Review Steering Group, including Deputy Ferbrache, Deputy Mark Helyar, Deputy David Mahoney and Deputy Peter Roffey.

A public drop-in will take place at Beau Sejour on Saturday 14 January from 10:00 to 12:00.

A public meeting will happen at Beau Sejour on Tuesday 17 January from 19:00. The presentation will be followed by questions from the audience,  all broadcast on Facebook as well.

Deputies will then travel to Alderney on Saturday 21 January for a drop-in at the Butes Centre.

Events are being held this month for Islanders to hear from States Members on the Tax Review recommendations.

The first event is a Live Facebook Q&A at 7pm, 10th Jan. There will also be a public meeting and drop-in events in Guernsey and Alderney. More at https://t.co/1ZC4EF6C6Y pic.twitter.com/Rwp02U5EMr

— States of Guernsey (@Govgg) January 4, 2023

The committee has been keen to stress that its package is much more than just about GST as it looks to plug an expected shortfall in public finances of up to £100m a year.

P&R’s package contains these key elements:

• A new 15% Income Tax band on everyone’s income up to £30,000. For someone on median earnings (about £37,000 a year) this will reduce their tax bill by about £900 a year.
• An increase in the personal income tax allowance of £600 which will reduce people’s bill by £120 a year.
• A broad-based GST at 5% with relief for a limited number of things like rents and mortgages. This is expected to increase household costs by about 3.4%, which would be about £1,100 for someone on median earnings.
• A restructure of Social Security contributions to give everyone an allowance. This makes the system more progressive and would mean an employed individual on median earnings gaining about £600 a year.
• Pre-emptive increases to pensions and benefits to anticipate the impact of inflation.
• A scheme to provide financial support to certain low- income households outside of the benefits system.