‘Sales tax debate delay is high-risk’

By James Falla

A DEPUTY is looking to force an early debate on a goods and services tax - even though he does not want to see it introduced. Chris Brock will try to amend the Policy Council’s progress report on zero-10 changes, which will be debated by the States next week.

The council has decided to hold an enabling debate on GST in autumn 2008, taking into account Jersey’s first six months with the tax.

Deputy Brock described a 12-month delay as a ‘high-risk policy’.

‘The figures provided to date on income generation to meet the tax shortfall have been too sparse. An early debate on the need, or otherwise, to introduce GST will demand far more detailed income and expenditure projections to be presented to the States,’ he said.

He feared that information from Jersey’s GST would be limited by next summer and that delay in considering such a tax would also cause delays in its introduction.

‘There is a lot of uncertainty in the business community concerning GST and the quicker this possible new source of taxation is debated, the better businesses can plan for the future.’

Deputy Brock said that people were worried about the tax burden they could face from 2008 - much of the detail has not been settled.

‘There is also uncertainty among the general public about the implications of the new fiscal strategy on their own personal cost of living,’ he said. ‘I think that it is better to be open and honest earlier as to what this means for everybody, bearing in mind that interest rates have gone up in the past year and mortgages are a fair degree more expensive.’

Deputy Brock has also complained that financial information in the report is sparse. He considered that income forecasts were generous and expenditure estimates undershot.

‘I believe that the picture is a little bit optimistic,’ he said.

But he hoped that the States could cope with the loss of millions in tax revenue and not need a GST to balance the books.

‘I am not trying to derail the process,’ he said.

Treasury and Resources minister Lyndon Trott expressed surprise at the amendment.

‘I think that Deputy Brock may have misunderstood the decision of the States last June. A key criterion of the evaluation process on GST is watching closely the Jersey experience and we will do that in 2008 and 2009,’ he said.

Article posted on 25th May, 2007 - 12.00am