Deputy David Goy said his scheme would render GST, or any increase in income tax, unnecessary.
He said it is built around a simple question: ‘Before increasing the cost of living for ordinary households and raising the cost of doing business, have we properly established whether ALL existing capacity for contribution within the system is already being fully captured?’
The first of his proposed new taxes is a swingeing levy on empty or under-used properties, which he suggests should be set at a rate of at least 50 times the current level of TRP.
For private properties this would include both holiday homes and those houses left completely vacant.
But he does suggest a period of grace, for at least a year, to allow owners to adapt to the new regime by selling their properties or leasing them out.
He is also suggesting exemptions for houses that are actively being marketed, being renovated, subject to probate, or where the owner is in either hospital or a care facility.
The new tax would also be levied on any commercial properties left ‘substantially vacant’ for more than 12 months.
In order to determine which properties are actually vacant, or under-used, Deputy Goy suggests the States monitors electricity and water use.
The second pillar of his alternative tax package targets those living in expensive homes, but who pay little in income tax.
He is worried that wealthy people are using tax-efficient schemes to avoid paying their fair share towards funding the island’s public services.
His suggestion is that those living in homes in a band with the highest 10% of TRP ratings in Guernsey should have their tax returns monitored.
If those tax payments are lower than would be expected for someone with such substantial property wealth, they would be subject to a ‘fair contribution assessment’.
Here too there would be certain exemptions, such as for retirees who were asset rich but cash poor and living mainly on the States pension.
The final strand to Deputy Goy’s proposals involves what he calls a ‘Premium Asset Levy’, which would see those with private aircraft, large pleasure boats or high-end cars, plus those buying very expensive properties, paying new charges.
Deputy Goy is collectively calling his three new levies a ‘Productivity Incentivisation Tax’ or PIT.
He is launching a public consultation on his alternative tax package today.
The 90-page consultation document is available at https://davidgoy.gg/pit.php