Guernsey Press

P&R working on its own GST-free alternative tax plan

Policy & Resources is prepared to drop a goods and services tax in pulling together an alternative tax package for the second half of the Tax Review debate this month.

P&R president Peter Ferbrache, seen here greeting protesters on the steps of the States, has admitted he thinks GST will be voted down when debate on the tax review resumes later this month. (Picture by Luke Le Prevost)

Committee president Deputy Peter Ferbrache and his members say they still prefer their original plan, including GST, and want it voted on when the debate resumes in two weeks’ time.

‘However, P&R has listened to the views of the community and States members, who wish to see an alternative,’ the committee said yesterday.

‘The committee is, therefore, seeking to develop an alternative set of proposals that can be debated alongside the original plan, taking into account ideas put forward by other members, and replacing a GST with other revenue-raising measures.’

P&R president Peter Ferbrache has admitted he thinks P&R will lose the vote on introducing GST at 5% by 2025.

And he is concerned the States will fail to agree a long-term plan to plug a hole in public finances, which is projected to be about £100m. a year later this decade.

‘The committee is determined to develop an alternative that comes as close as possible to achieve the objectives,’ it said yesterday.

‘It wishes to give the States the best possible choice, and to do what it can to avoid a situation where no decision is made and no solution for addressing the growing shortfall is found.’

It is understood P&R will draft a composite amendment which, if approved, would allow the Assembly to vote sequentially on its original tax package followed by its new alternative one.

This is the approach recommended by Deputy Heidi Soulsby and other authors of a revised version of her ‘fairer alternative’ tax plan which was defeated in the States on Friday.

‘P&R will work over the coming days to finalise the details so it can publish the alternative package as soon as possible and no later than Wednesday next week.

‘In the meantime, it is engaging further with States members so they can input into the development of the alternative.’

After meeting yesterday, P&R stressed it was not backing out of its original proposals, which recently sparked a public march attended by 2,500 people.

‘The committee remains of the view that its original proposals are the best way to reform the tax system in a way that is genuinely progressive, reducing the burden for those on lower incomes, while raising enough revenue to ensure public finances remain sustainable as demand on health services and pensions increases.’