‘Getting tax decision right is crucial for the Bailiwick’
VIEWS are shifting in Guernsey about the need to raise additional taxes, according to a key proponent of the introduction of a goods and services tax.
Deputy Peter Roffey, speaking at a media briefing yesterday in his role as President of Employment & Social Security, said islanders had come to accept that there was a problem that needed fixing and discussion had moved on to how to fix it.
‘I think we are making progress,’ he said.
‘We’re getting a lot of grief, of course we are, but I think a few months ago people were really questioning whether we needed to increase taxes – and some still are – but it’s increasingly shifting, now, to “OK, we accept there probably is going to be a funding gap coming up because of the reasons you’ve given, we’re not yet convinced that what you’re proposing is the best way to do it – why haven’t you looked at this and why haven’t you looked at that?” And that’s great.
‘Some good ideas may come out of that. It may change our own narrative as well.
‘If it’s accepted that there is a problem that needs fixing and we’re talking about how to fix it – that’s progress.’
Deputy Roffey was joined by Treasury lead for Policy & Resources Deputy Mark Helyar, who reiterated his belief that only a GST can bridge the anticipated gap between the Bailiwick’s future income and its future costs.
‘Getting these decisions right is crucial to the Bailiwick’s future,’ he said.
Any tax changes agreed by States members – when the issue is debated in July – would be introduced gradually, he reassured islanders.
This would avoid any sudden inflationary pressures and would also ensure that savings found by cutting costs or growing the economy could be taken into account.
‘If, by some good fortune, we are able to navigate a means of avoiding these rises, then of course we would do so,’ he said.
‘But we have to plan for the worst outcome or we will have failed to prepare for the challenges our community will face in the next few decades.’
The plan favoured by both deputies is a GST of 8%, which would raise considerably more than the expected shortfall of £85m.
This would therefore provide the necessary funds to overhaul the social security system and significantly increase the income tax threshold, meaning the lower paid would end up better off.
