Proposals aiming to stop GST set to be published
BBCAn attempt to stop GST from being introduced in Guernsey is set to be launched by a long-time critic of the policy.
Guernsey's States agreed to introduce a 5% GST, alongside a lower rate of income tax for earnings under £32,400 and reforms to social security contributions.
Currently government officials are working on introducing the tax in 2028, with deputies set to vote on whether the tax should apply to food at the end of February.
Deputy Liam McKenna is set to bring an amendment to those proposals, to take GST off the table for this political term - which means until at least June 2029.
It's being seconded by another long-term opponent of GST, Deputy Simon Vermeulen, and instructs P&R to stop all work on the introduction of the tax.
'You can't tax your way to prosperity'
Deputy McKenna said his proposal would "take away the propositions that got forced through a couple of years ago, forcing the community into something that I don't believe they actually want".
When challenged as to how he would make up the proposed shortfall in government revenues, he said selling the Castel Hospital was one option where money could be raised.
He also suggested the States should introduce rent controls to ensure local families had access to affordable properties.
McKenna criticised recent States revelations, which showed £42m had been wasted on two failied IT projects: "It's cost every homeowner £1,600 for our mistake so you say to yourself you can't tax an island into prosperity why should you be asked for more money to pay for my mistakes. So you say, no, no, no more."
The proposals agreed at the tail end of 2024 for a GST were expected to raise about £50m a year and the administration cost was estimated at £2.4m, with responsibilities divided between the Revenue Service and the Bailiwick of Guernsey Customs and Immigration Service.
Alongside work to introduce a GST, a review of the island's corporate tax regime is under way, led by Policy and Resources' member Charles Parkinson.
That review is set to be published before the end of June.
Deputies will then make a decision on the future of the island's tax system, which could include higher taxes for businesses and/or a GST.
Despite this, during debate on Guernsey's budget for 2025, deputies rejected proposals for an increase to income tax and backed a package of tax reforms centred on a 5% GST.
Policy and Resources has made delivering tax reform one of the States "super priorities" for this political term.
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