OPINION: Many retailers would "close or downscale" if GST comes in

Tuesday 17 January 2023

The Head of Retail Development at the Guernsey Retail Group has issued a warning of the impact a goods and services tax could have on shops and other businesses across the Bailiwick.

The GRG has surveyed its members to gauge their feelings towards charging GST and Korinne Le Page has written the below on behalf of the group:

Pictured: Korinne Le Page speaking at a Thrive conference in Guernsey in 2018.

"The outcome of our poll to members shows that many feel they would close or downscale if this tax is introduced, which would be very harmful for Town and other centres and naturally reduce the choice for local consumers.

We believe this would negatively impact on our local community and completely ignores the value retail brings to the Island. The sector here has recovered well from the pandemic as our shop vacancy rate stands at 7.8%, comparing favourably with the UK which is running at 13.9%.

This is not the time to introduce a new, blanket tax when inflation and the cost of living are so high. Timing could not be worse and even if this comes into effect in two years, we have learned that the impact of inflation is long lasting and yet another hurdle for businesses to overcome, in addition to increased import costs, staff shortages and the ongoing threat of online shopping.

Even with the £300,000 level, not only would Guernsey be seen by tourists as now having a sales tax, it also doesn’t necessarily mean businesses with a higher turnover have sufficient funds to spend on the various changes that will have to be made. Also, this threshold will thwart growth as some retailers will want to remain below that figure.

We strongly believe that that all the alternatives which could address Guernsey’s financial issues should be seriously considered, as the unintended consequences of GST could have a substantial and long lasting impact on our whole community as well as the economy."