Income tax rises ‘not the answer’, says Giba

Even as Policy & Resources president Lyndon Trott makes a last-ditch bid for support for his policy in this newspaper today, the Guernsey International Business Association has said along with addressing deficits and stabilising the economy, it also wants to see the government deliver savings and to halt increases in public spending.

Giba said it feared that the States would once again fail to make a decision on addressing the ‘serious structural challenges’ facing the island’s economy as it debated the Budget.

‘The States has failed to make decisions on revenue and investment strategy on multiple occasions in recent years. Giba yet again implores deputies to act to avoid further delays that will have adverse commercial, economic and social consequences for the island.’

The association, an umbrella group for all sectors of the island’s finance industry, said it was ‘laudable’ that P&R had attempted to address the funding issue. But it believed that the committee was going about it the wrong way.

‘A temporary income tax increase might appear as an expedient immediate response to address the recent deficits, but income tax rises are not the answer,’ said chairman Paul Sykes.

‘A more strategic approach is needed to broaden and diversify the tax base, one that will have a more equitable impact on all members of our community, protecting those on lower incomes while including greater contributions from its wealthiest citizens.

‘At the same time, it is imperative to retain Guernsey’s competitiveness as a place clients and investors want to do business. Measures must include explicit public spending restraint and encourage investment in infrastructure and economic growth.’

Deputy Trott has today said that the States has ‘invested far too little in our island’ and current investment plans, which are under funding threat, are just playing catch-up.

‘Let’s give our next Assembly the platform to build a positive future and grow the economy,’ he said.