The survey revealed that average household expenditure fell in real terms between 2018/19 and 2023/24, having also fallen in the previous five-year period.
P&R said it would use the survey results to provide updated figures for its tax plan – which is centred on a 3% tax on consumption – ahead of deputies resuming their landmark fiscal debate at the end of September. The senior committee said that an initial review of high-level data suggested there would be ‘a relatively limited impact on the total estimated revenues’ from its proposed reforms.
‘However, we’re going to rerun our modelling to check.
‘This is not a quick piece of work but will be completed in the next month,’ said P&R president Lindsay de Sausmarez.
Robert Curgenven, a leading critic of P&R’s proposals, believed that the survey figures underlined repeated claims that the tax plan was based on flawed assumptions.
‘Deputies began debating GST earlier this month using eight-year-old, pre-pandemic spending data,’ said Deputy Curgenven.
‘I raised concerns about relying on such outdated figures, but P&R dismissed them. ‘We now have data from just two to three years ago which appears to show very different spending patterns, raising serious questions about the GST revenue forecasts presented less than two months ago.’
Deputy de Sausmarez claimed that her committee’s tax plan, which also includes reductions in income tax and social security, would leave most households better off and therefore ease the cost of living concerns raised by the survey.
‘Although individuals will pay less tax and social security overall, much more money will be raised from corporates, visitors and the islands’ wealthiest residents, which will help to fund the public services and infrastructure that the community and economy rely on,’ she said.
‘The results of the survey are further evidence that we need to restructure our tax system to move the burden off the shoulders of individuals, especially people who are struggling, and raise more from entities that can afford to contribute more, and that’s what our tax reform proposals do.’