Guernsey shocked by £52m tax ‘hole’

Saturday 7th March 2009, 9:59AM GMT.

GUERNSEY could be about to introduce GST after all – having discovered a ‘surprising’ £52m hole in their finances.

The island’s Treasury Department say that they might have to add a penny to income tax and introduce a 3% sales tax to fill their tax gap. It will be embarrassing news for Guernsey’s politicians – although Jersey started preparing for hard times several years ago, Guernsey’s Chief Minister, Deputy Lyndon Trott, told an Institute of Directors meeting in early 2008 that although they had a GST law ‘on the books’ they might not have to bring it into force.

Last February, he said that income tax, economic expansion and interest from their Strategic Reserve could fill their black hole, given continued economic growth. Jersey’s then-Treasury Minister, Senator Terry Le Sueur – now the Island’s Chief Minister – described Deputy Trott’s view of Guernsey’s economic prospects as an optimistic one at the time.

Pictured: How the Guernsey Press reported the tax findings

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1
Mark’s perspective

March 7, 2009 at 3:40 pm

At time for progressive taxation? 1p on income tax for all those earning over £100,000? Or, 3% GST for rich and poor alike? Interesting times.

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2
mad foetus

March 7, 2009 at 9:08 pm

well, at least Jersey had the foresight to introduce GST before we were skint. Just goes to show, 19,000 people were wrong (but they still won’t admit it).

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3
Alex

March 8, 2009 at 9:40 am

This was invertible surely? They all moan if you try to make em pay for parking… what did they think the money would be used for?

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4
Keith

March 8, 2009 at 5:32 pm

Easy to overlook £52,000000 you can’t blame the government.

Haven’t been banking with RBSI have they?

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5
Mike R

March 9, 2009 at 10:31 am

Would any of those who moaned about Jersey introducing GST like to speak up?

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6
Nellie Macon

March 9, 2009 at 2:21 pm

We never claimed there wouldn’t be a shortfall in revenue when exempt tax was no longer applied but there were better alternatives to GST. Many people favoured what has been adopted under ISE (£100 annual charge on all companies adinstered in Jersey) but for some reason known only to themselves Treasury decided to limit this to £100 – £200 would have covered this shortfall without the need to implement GST. As for clients deserting Jersey if we introduced an alternative charge to the exempt tax – not a quibble from anyof them so far and they wouldn’t have been bothered by a £200 charge either. It would have been far cheaper to implement as well.

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