Proposed spending plans are totally unacceptable and unaffordable
POLICY & RESOURCES’ latest GST funding and tax plans will damage businesses and suffocate economic growth. This additional burden will only increase the cost of living in Guernsey. With recent increases in fuel, heating and food, the public cannot be burdened further with additional taxes on all goods and services. For many the cost of living in Guernsey has become unbearable and they can no longer afford to stay and are picking up their belongings and leaving.
The Chamber of Commerce claims there are sophisticated programmes that will simplify the onerous administration for the retailer or business. These programmes in many cases cost thousands of pounds and require real time and expertise to install and upkeep.
Most small businesses run on basic needs and systems. The new proposals will also be restructured and increase the social security contributions made by employers of these businesses.
The increased financial stress on business means decisions will have to be made whether to continue or fold up and close the doors.
In almost every jurisdiction, once a tax is introduced, it never goes away.
What has happened to the election demands for common sense, and the reduction of the public service and waste in government?
With a broad-based 5% GST households under the proposals will pay more than £50m. but may get £29m. back through tax reform. This leaves £21m. to cover the cost of GST administration, including an additional stream of civil servants, their salaries, pensions, relocation allowances and housing subsidies as well as internal system developments to compute and collect the tax. So what is really left after this to feed into the spending frenzy of this administration?
The latest P&R Funding and Investment Plan to be debated next month calls for not only GST at 5% but further borrowings of £350m. in Scenario 3 or £200m. of borrowing in Scenario 2 in order to meet the wish list of capital investment needs of government departments in the States. How are we ever going to repay all this borrowing and how many generations is it going to take to repay this debt? The new proposed spending plans are totally unacceptable and unaffordable.
Without private investment coming forward, cuts to tax caps on high earners and taxing local companies on profits, the States must only deal with essential high priority ongoing capital schemes first and foremost.
Say no to GST and restrain further borrowing. The Guernsey way has always been to live within our means.
Deputy David de Lisle
Le Douit Farm
Rue des Fontenils
St Pierre du Bois
GY7 9DH