This penal approach isn’t something that public finances absolutely demand, however. Rather, it is a convenience for politicians because it will make it easier for them to balance the books in future, in the event of unemployment or a scarcity of jobs.
‘Broadening the tax base’ is actually States-speak for government recognising it can’t tax you if you’re out of work, but bureaucrats will still have you if you try to eat, feed the family, heat the home or drive to the shops.
It is an ultimately cynical tax and enables politicians to ignore growing the economy and ensuring a steady supply of well-paid jobs for islanders, and indeed, the workforce to take those jobs, so that they can continue paying income tax.
What makes P&R’s tax review green paper more disturbing, however, is that it starts from a position of current levels of expenditure and projected increases and expects islanders simply to pay up and look happy about it.
This is hardly a partnership approach to a major policy shift. But government has history in these areas. When zero-10 was first mooted, the States expected everyone else to make up the fiscal deficit caused by scrapping corporate tax.
It took a backlash from islanders and a lot of pressure from the media before government acknowledged that it, too, would have to play its part – although in the event its ‘savings’ were largely charging for services previously provided through tax contributions alone.
This feels like similar territory. Yes, the report dismisses state economies as being insufficient to raise the sums it requires but we still await details or even ideas on possible cuts.
The committee has also, so far, failed to ask islanders what they might be prepared to go without to minimise tax rises or avoid GST.
But it has floated consideration for means-testing universal benefits – very unlikely to be popular.