Guernsey Press

Deputies stand up for small business over GST

THREE members of the Committee for Economic Development have today come out against a goods and services tax as the solution for Guernsey’s future financial deficit and called for a year’s delay in the tax review debate.

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Committee president Neil Inder and members deputies Nick Moakes and Simon Vermeulen accept that a structural deficit needs to be fixed, but say that a GST is not the way to do it, due to the impact ‘it will almost certainly have on middle Guernsey and “real economy” businesses’.

They say they note concerns raised by the island’s retail and hospitality sectors about GST, particularly with regard to online competition, and the administrative burden of GST on small local businesses.

‘We cannot support a GST which puts local retailers at a disadvantage,’ the three deputies say in a letter published in the Guernsey Press today.

Deputy Nick Moakes. (Picture by Luke Le Prevost, 30524113)

‘A GST will increase operating costs in the hospitality sector and could make us a less attractive destination to visit.’

They also express concerns about the impact on the poorest and middle-income households.

‘The extra imposition of GST on these already-stretched islanders who have little voice will be an act of impoverishment for many.’

The deputies say that too many big issues are on the table for this current States to take a lead on a tax strategy as a first priority and so are pushing for a year’s delay on the tax decision to enable the States to make the most informed decision.

They say population policy should be agreed first, followed by a housing strategy, skills strategy, and then the tax strategy, to be informed by all three debates.

Deputy Simon Vermeulen. (Picture by Luke Le Prevost, 30524116)

‘To do anything else, to rush something out simply to meet a self-imposed tax review deadline in July 2022, is unnecessary and we would encourage Policy & Resources to delay the final conclusions of the tax review until such time when all States members have the relevant, fact-based information in front of them to make an informed decision.

‘Our counsel to all deputies and Policy & Resources is that this is not the day and this is not the hour for GST. We would advise them to do this in the correct order – and if that means delaying the tax review, then so be it.’