United Kingdom: Guernsey GST Proposals Prove Unpopular
27 August 2013
Posted by: Author: Jason Gorringe
Author: Jason Gorringe
The Guernsey Government has published a report detailing responses to a two-month public consultation on the future make up of the domestic tax regime, finding in particular strong opposition to the introduction of a goods and services tax (GST), as is in place in fellow Channel Island Jersey.
The consultation, which concluded in June, was launched to inform the Government's two-year review of the personal tax, pensions and benefits system. The feedback report, released on August 23, 2013, provides a factual numerical and written analysis of the 248 responses from individuals and organizations, and also includes a summary of feedback received during numerous public meetings held during April and May.
There was broad agreement on:
- The need to restrain public expenditure and to maintain a limit on the tax burden set by the States on households;
- The need to maintain Guernsey's competitive position internationally;
- Broad support for the current Old Age Pensions arrangements but less willingness to pay more for it; a further rise in the retirement age was the preferred route to limit expenditure;
- More support for increased future funding of healthcare than for increased expenditure in general, with a preference for increased personal provision in some areas including pensions; and,
- A clear majority was in favour of capping means-tested benefits and measures to incentivize work.
Respondents opposed increasing the taxation of consumption and instead favored a review of tax expenditures and welfare spending. The Government reported there was a "clear majority against the introduction of a Goods and Services Tax."
Gavin St Pier, the island's Minister of Treasury and Resources, commented: "Whilst the consultation provided few surprises, it does provide us with a robust assessment of the preferences of the Guernsey public. We will be taking these findings on board as the two Departments work together to seek to ensure our public finances are set on a sustainable long-term path."
Allister Langlois, Guernsey's Minister of Social Security, added: "Understanding opinions is invaluable to us as policy makers to help us determine proposals to resolve the many long-term public finance issues we face. The two Boards intend to bring forward recommendations to the States in a joint report in 2014."