Time to go for broke?
FROM a very early age I’ve always had a feeling that I know how to spend my money better than others. Possibly this instinct may be inherited because my dad was of pretty much the same mind. And I believe I have passed this on to my children as I recall my youngest after being coerced by his mother to throw a coin into a fountain for charity immediately jumping into the water to retrieve it.
This probably explains my uneasy relationship with taxation, because I’m absolutely certain that I know how to spend my money better than the States of Guernsey. ‘Another crazy scheme, Mr Brehaut? Here, take my wallet why don’t you?’
I therefore have devoted my life to tax avoidance. Don’t get me wrong, I’m happy, well perhaps not happy, to pay my share but if there’s a choice to avoid a tax then I’m first in line.
For instance, Gavin can try to get my money from duties on fuel, booze and fags but as a non-driving, non-smoking teetotaller I can happily emulate the bowmen of Agincourt by giving him the traditional salute.
Recently I have turned my attention to getting one over on the States of Guernsey by changing my lifestyle and taking advantage of the new waste strategy to reduce my existing waste bill. By eliminating black bag waste from my shopping choices I estimate that if, as I expect, my parish waste charge falls to a level similar to the £87 States fixed charge and if I eliminate black bag waste all together, I will be £3 per week better off next year when the new charges are introduced.
One up for the Horacle.
Imagine therefore my shock and horror when early Tuesday morning while still in bed I read the recently published 2019 Budget and saw the huge increase in TRP for ‘Large Properties’.
Beads of sweat immediately formed on my forehead and my heart started beating even more irregularly than usual. Had the States of Guernsey at my moment of victory on waste struck me down by imposing a huge, regressive tax on Old Farm?
If so, how could I avoid it?
At least with the long-forgotten window tax it was relatively easy to brick them up to avoid paying.
Who needs natural light anyway? But TRP being based on the area of a house can only be reduced by knocking bits down. Ah well, that’s the conservatory gone then.
A frantic few minutes followed as I searched for an old TRP bill. Then by squinting, I couldn’t find my glasses, I managed to add up the various bits of domestic TRP hoping and paying not to exceed the 500 units barrier that would carry me into a stratospherically higher tariff rate. Hallelujah, I’m still in the four hundreds! Praise be to St Pier, ‘only’ a 10% increase, which though it dramatically reduces my waste saving still leaves me with the smug satisfaction of having beaten the system yet again.
Tax is personal and we all handle it in our own ways. But even in these so-called times of austerity and fiscal restraint by government there is no stopping the forever growth of the amount of our money the State believes it can spend better than us.
Despite the cuts, the plans, the sacrifices, the kicking the can down the road, there seems to be little appetite for the States to stop lightening our wallets and purses. Just how much of a share would they be taking without the cuts, plans, sacrifices and can kicking? It’s scary just imagining.
Now the civil service is going to be made more fiscally efficient and will save us £10m. a year. It’s a good initiative, although I would like to see a change in the system of government carried out at the same time to keep government and civil service properly aligned for the next decade or so.
However, I would like to ask if the £10m. saving will be handed back to the taxpayer in lower taxes and duties or if it is more likely it will be absorbed and taxes increased further year on year?
I think we all know the answer to that one. And therein lies my problem with this and past budgets presented by Deputy St Pier. What happens when there is no more fat to cut but the costs of running this island continue to rise in real terms? Will it mean more and more money will have to be passed from islanders to the States? What happens if islanders don’t become more productive? Will they just become poorer, relying on the States to provide more and more services at an increased cost which will need higher taxes to pay for them?
There has been a need for fiscal constraint and Deputy St Pier has been the man to lead us during this period. We must however accept that this ‘prudent’ style which revels in being one of the few global governments operating a surplus cannot go on forever. Has our president got a plan B?
When will we see the budget that propels us into growth and is really self-funding by increasing the amount of tax take, but not increasing the proportion of income taken as tax?
We are in good, steady and safe hands. In the private sector this reminds me of a cautious managing director, who in troubled times kept the bottom line looking good by cutting costs with schemes such as limiting free Post-it notes to senior managers and above. This does work for a year or two, but without new business it cannot be sustained for ever.
With my gung ho business developer hat on, I’m waiting for the budget when we go for broke. Let’s stop managing our decline by opening the stationery cupboard and announcing free Post-its for all. It isn’t a really great way to encourage those individuals and business who keep us afloat by taxing them more year after year. The 2019 Budget must be the last Accountant’s Budget. In 2020 let’s shove cash into the hands of the entrepreneurs and business developers.
You know it makes sense.