The group is calling on the States to match any tax reform with an urgent plan to grow the local economy.
Its survey drew responses from 65 businesses of different sizes across all types of retail.
About 95% said they were moderately or highly concerned about the possible effect of GST, more than two-thirds said they were highly concerned about their future viability, and almost nine in ten described their current trading as stable, fairly strong or very strong.
The group said this showed the concern was not limited to businesses that were already struggling.
A majority said the introduction of GST could feed into decisions about downsizing, reducing staff or closing.
The group said these were businesses’ expectations, not a prediction that GST would directly cause those outcomes.
But it said they were a serious warning, at a time when firms already face rising staff and property costs, freight pressures, recruitment problems, fragile consumer demand and competition from off-island and online sellers.
Businesses also raised concerns about the cost of changing accounting and till systems, extra bookkeeping, and pressure to raise prices or accept lower margins.
In a letter to the Guernsey Press, which will be published in full later this week, the group’s directors said the tax debate was too focused on raising revenue and not enough on growing the economy that revenue comes from.
‘Guernsey cannot secure its long-term prosperity simply by raising more revenue from the economy it has today,’ they said.
The directors warned that closures would hit employment, consumer choice, commercial property, supply chains and government revenue, and that falling footfall could spread harm across St Peter Port, The Bridge and other commercial areas.
They pointed to the £150m. of high-street support announced by the UK government in January and said that acting early to sustain town centres was better than trying to reverse decline.
The group wants growth in the consumer economy made an immediate priority, with measures brought in well ahead of any tax changes.
It has proposed a Local Economic Contribution Rebate Scheme, which would use objective criteria to reward businesses that bring measurable economic and community value to the island through local jobs, payroll, premises, training and investment.
‘Once a strong and diverse local business community has been lost, it is far more difficult and costly to rebuild,’ they said.
You need to be logged in to comment.