Specialists from industry, academia and the public sector – mostly from outside the island – have been approached to examine company tax changes and other revenue-raising options which could generate in the region of £50m. a year for the States.
Charles Parkinson, who was announced yesterday as the chairman of a Policy & Resources sub-committee on tax, has pledged a new approach to tackling the deficit in public finances.
‘We have put out feelers to some experts at a very senior level who really know what they are talking about and have impeccable credentials, and I am hoping they will accept and come and join us,’ he said.
‘The sub-committee and its work need to have credibility with the finance industry and the public generally, and we need once and for all to settle the issues about fiscal policy in the medium term.’
Deputy Parkinson has campaigned for years for a new company tax regime to replace zero-10, but some business groups and deputies with close links to them have criticised his ideas as potentially dangerous to the finance industry.
Two weeks after winning a seat on P&R, having finished third at the general election, he said yesterday that he wanted all the arguments for and against company tax reform to be brought into the open.
‘As Lindsay de Sausmarez [P&R president] has said, we are hoping to make this a very open process.
‘I don’t see why meetings of the panel couldn’t be open meetings.
‘And when we get expert witnesses to talk to the panel, I would hope to provide them with a platform to talk more widely to industry and anyone else who is interested, so that the public can see that we are looking into this with great seriousness.’
P&R would like to present a revised tax plan by the end of March next year. However, that timeline remains only indicative, as the new senior committee is less anxious about the short-term financial position than its two predecessors who held office in the 2020-25 term.
Deputy de Sausmarez confirmed that preparations were continuing for GST-plus, agreed by the previous States, and it should be ready for introduction in 2027, although that could change if Deputy Parkinson’s sub-committee produces a revised plan which makes a consumption tax unnecessary and wins support from the Assembly.
‘There are really only two options to do the heavy lifting on tax – GST, which is the status quo policy, or reform of corporate tax, which we now need to focus on,’ said Deputy Parkinson.
‘The election showed that GST is unpopular.
‘A lot of deputies who supported GST lost their seats.
‘The public expect us to look properly at other possibilities and we are going to do it expeditiously but thoroughly. This is a pause and review where there is actually a review.’
The sub-committee also includes P&R vice-president Deputy Gavin St Pier, who has been appointed as the senior committee’s lead on financial and other resources.
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