Jayne Ozanne believes that impression will only be strengthened by this week’s debate in the Assembly about whether to include food if a goods and services tax is agreed later in the year.
She is urging Policy & Resources to give the public more confidence that elected members are making the key decisions on tax policy.
‘There has been a growing sense of frustration among deputies and the public as to who is perceived to be in the driving seat when it comes to policy matters, especially on tax reform,’ she said.
‘Despite it having been agreed that the main debate about whether GST should be implemented will be in the summer, there is increasing concern that some officers regard the decision as already made and that States members are being managed down a path that will deliver this pre-determined outcome. Whether or not this is true is secondary to the fact that it does nothing to help build trust and confidence between States members, officers and the public.’
Deputy Ozanne wants the decision on food to be deferred and included in a landmark tax debate set for July, when P&R has said it will lay out the full details of various options for dealing with a ‘black hole’ in public finances.
She spent the weekend discussing the possibility of a sursis – a delaying motion – with other deputies who share similar concerns about this week’s debate.
P&R president Lindsay de Sausmarez rejected any suggestion that her senior committee was being pushed around by officials convinced of the need for GST.
‘GST is not being treated as a given and we are working hard exploring the alternatives,’ said Deputy de Sausmarez.
‘The decisions on tax reform are political and will remain that way. Officers act on our direction, not the other way around.
‘Officers are working to a States resolution to prepare the package agreed in 2024 [GST-plus] while also working to this P&R’s direction to explore alternatives, such as corporate tax reform and significant expenditure reduction, exactly as we committed to when elected.’
P&R wants a direction from deputies this week on whether GST should be set at 5% including food or 6% excluding food.
It argues that direction will allow it to present the States with an informed comparison of tax-raising options this summer and then bring in whichever option is agreed as early as possible.
But Deputy Ozanne argues that it is premature to make a decision about GST on food until P&R has completed the ongoing study of other tax-raising options, provided more information about the size of the deficit in public finances in the 2025 accounts, and agreed a new long-term fiscal policy framework which it was recently sent away to reconsider.
‘Given problems with the Revenue Service, unknown income from Pillar II company tax changes and unrealistic assumptions about capital spending, we do not have a clear enough picture of our finances for us to visit such a punitive tax on hard-working islanders,’ she said.
‘Deciding whether GST should be applied to food is the most controversial part of the debate.
‘Having it first risks further undermining levels of public trust and confidence in the States.
‘It is also generating much confusion and ill-will among the public, a large proportion of whom are strongly opposed to the concept of GST, even when coupled with the “plus” support package. This could be avoided by debating items in a clearer and more logical sequence.’