This Is Guernsey

By Thom Ogier

DEPUTIES demanded an emergency States debate yesterday at the chief minister’s briefing on the fall of Guernsey’s zero-10 tax regime.

But their calls apparently fell on deaf ears.

Almost all appeared to think moving away from zero-10 was the right way to go after EU states decided it was contrary to the spirit of their code of conduct – and many saw that as an opportunity.

Chief Minister Lyndon Trott is to speak to Financial Secretary to the Treasury Stephen Timms today to give an indication as to whether Guernsey is likely to move away from zero-10.

Deputy John Gollop explained that there had been a show of hands taken to indicate how many felt an emergency Billet should be issued immediately, so that the States could meet officially and debate what to do.

‘More than half raised their hands,’ he said. ‘But this was ignored because the chief minister said some members had left early.’

Many also said they learned about the situation from the Guernsey Press and questioned why they had not been informed earlier.

‘I heard about it from the Guernsey Press before I heard about it through the government and would rather it was the other way round,’ said Deputy Sam Maindonald.

Deputy Gollop was also critical of the way the situation had been handled.

‘It was horrendous,’ he said.

‘So much annoyed me about this meeting – there was a strong feeling that we were being told to roll over and have our tummy tickled.’

Deputy Barry Brehaut said what had happened was insufficient process.

‘You can’t have a show of hands in a basement room at Beau Sejour – the place to do it is in our parliament. This is very frustrating. And when you have a consensus model of government, it is useful if people are given information at the same time.’

Deputy Mary Lowe was among those calling for an emergency Billet, preferably by Monday. ‘The chief minister did not give an answer and said he had to speak to Policy Council – well, the majority of them were there.’

She said Guernsey kept boasting about how closely it would work with Jersey but that should be an area for concern. ‘I just don’t think we should put so much faith in working with Jersey because we are competitors.’

Deputy David De Lisle felt vindicated by what had happened after always having said zero-10 was wrong.

‘The States are having to make a U-turn on a decision and I am very happy about it because this could result in the burden being taken off the individual to pay for the corporations.

‘Zero-10 was very wrong, morally wrong, and it has cost us £100m. per year. Who is accountable for that?

‘Accountability has to be placed on the shoulders of those who pushed it forward.’

However some, such as deputies Mike Garrett, Mike Hadley and Mike O’Hara, said the chief minister and his team had acted responsibly under pressure.

Housing minister Dave Jones said: ‘I am very satisfied that Lyndon and Charles and the team are on the case.’

Deputy Marc Laine said he had never thought zero-10 would stand the test of time but believed it had brought some benefits.

‘We have just ridden out the recession relatively unscathed and if we had our old tax system, we might not have come out so favourably.

‘Change may help us address our fiscal deficit and this could be a real possibility and a defining period for consensus government if we can all work together – or an advertisement for executive government if we can’t.

‘I completely back Lyndon making a positive message to Mr Timms that Guernsey will look to move from zero-10.’

Deputy Maindonald said: ‘This is an opportunity for this island to pull together and to come up with a tax strategy that is going to be able to do the job we want to do while being as compliant as we can. I hope it will not result in us losing businesses. This comes down to how quickly we as a government can take the opportunity we have just been given and move forward with the business community.’

Deputy Jan Kuttelwascher said the future could be bright.

‘The issue is that we must achieve a level playing field with other jurisdictions.

‘If we can indeed have corporation tax at 10%, we could make £50m. per year and fill in our black hole.’

Article posted on 16th October, 2009 - 11.30am