£22m extra tax next year
Tuesday 13th July 2010, 3:00PM BST.
Treasury Minister Philip Ozouf's proposals are published in today's JEP
TAXES will go up by £22m next year at the same time that the States cuts package starts to bite.
Plans for the tax hike have been revealed in the 2011 Business Plan, which was formally published this morning.
• See today’s Jersey Evening Post for a full report
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thats it.. I’m off to france next year.. see ya!
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death and taxes, death and taxes….
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That’s gonna be a struggle, I don’t earn £22 million!
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But just who is dear Philip going to sting? The rich? Those on £100,000 plus?
What a non statement!
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Ant – comment #2 – i think i’ll choose death.
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Quote: “TAXES will go up by £22m next year at the same time that the States cuts package starts to bite”
OBVIOUSLY the cuts aren’t going to be implemented if they have to raise taxes as well.
Heard this bullsh!t before from Walker, Le Sueur and now Ozouf. While the states can raise taxes whenever they like they will NEVER stop spending and NEVER cut back, no one is accountable for their actions and no one is taking responsibility.
All they will do is Squeeze, SQUeeze and SQUEEZE the money, lifeblood and will to live on this rock out of everybody.
The more spin i hear from Ozouf and Le Sueur about the state of our finances the more I wonder how they ever became treasury ministers.
I am utterly sick and incensed by the continuous profligation of OUR hard earned money.
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This is obviously no problem at all. If you could call the tax paying population of Jersey, 100,000, it would only work out at two hundred and twenty pounds each per year etra tax !
The problem only arises when it is realised that only a fraction of the population actually have to pay income tax, so that leaves the only alternative as a ‘little bit’ more tax on commodities like food and clothing, plus, if you can still afford it, luxuries !
Sounds good plain mathmatics to me !
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I doubt there are 50,000 individual taxpayers in the island.
There are a lot of retired people, carers, etc that would be exempt.
Next year is an election year as well so hiking up taxes may not be that easy, quite a few States members will have one eye on the electorate!
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Please confirm the status of the rainy day fund…as we think you’ve spent it…?
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Any of this ring any bells………when we complained about zero ten taxation…….now we’ve got 400 redundancies. £100 million structural deficit…£22 Million in taxes….and who payes…….Middle Jersey…Were do the wealthy help out ? Not those earning £100 K but the Ozoufs , le Sueurs and walkers of the Island ( and their pals ) no they don’t pay a penny more. Were the teachers wrong to warn us now ! Not a bit, we have got what we deserve..hammered ! Because we allow the council of millionaires to get away with this.
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The tax consultation exercise has been less about consulting the public on HOW they think extra taxes should be raised, more about multiple choice options on choosing the lesser of the 4 evils offered.
ENOUGH, ENOUGH, ENOUGH!!!
Stop raising the taxes on the lower/middle earners and consumers. Make 20% MEAN 20% to ALL residents! Will the top earners REALLY leave the island if higher taxation means they forfeit their second Range Rover? Will higher income tax and 20% VAT in the UK, or longer travel and non-english speaking countries REALLY have the edge over 20% income tax. Lets give it a try!
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You lot make me smile. I live in the UK and pay 40% income tax, and soon to be 20% VAT – just put up and shut up – we are all in a difficult financial position.
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were is all the money going?!!!!
pay rises for the well off!!!!!!!!!!!!!!!!!!!!!!!!!!
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@1 Andy
Quel Bon Idee mon brave,when i (eventually, have dropped the price three times now )sell my house i will be off too ,good job both my boys live in the UK
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@6 Insensed
“..they will NEVER stop spending and NEVER cut back, no one is accountable for their actions and no one is taking responsibility.”
And isn’t that the truth from the man on the street.
Is there a requirement for States members to give details of their company directorships? One likes to think that probity has been followed however, the cynical in me would be interested to see if there are any “interesting awards” of states contracts.
States contracts paid for with tax payers money…
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Humm… Taxes will go up when the States cuts package starts to bite? What cuts are they?
Didnt he just admit that states spending will only go up by 1.1 per cent because of the cuts?
Is it just me, or is an increase of anything *not* a reduction? How is it that the planned cuts to spending will resulted in an increase in spending? Oh, and honey flavour it by saying its less than the cost of living? I know the states are used to lying to us, but I dont think I have ever heard anything so stupid.
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1 Million from 22 multi millionaires. Lets be honest it’s peanuts for them. But then again who’d tax themselves,
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The increase in taxation is only due to the massive increase in expenditure. £800 million for 2011. This has nearly doubled in the past 5 years.
Senator Ozouf has now made it quite clear he is making no cuts and is intent on further taxation to keep the massive pay gravy train rolling for his senior civil servants.
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Face the truth
2-4% on GST if the dummies on the Establishment bench can be bullied in to line!
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Incensed asked:
‘The more spin I hear from Ozouf and Le Sueur about the state of our finances the more I wonder how they ever became treasury ministers.’
I ask, who put them there and when is it time to vote again? All I see in these columns are complaints & more complaints about those in power.
This surprises me when I hear that the percentage vote is so low. So next time voting comes around, ALL of you who havn’t voted get off your a**, quit complaining & go and cast your vote!
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If you taxed everyone evenly and put a low income threshhold before being taxed I am sure you would cover taxes. I have heard its 6 hundred million to run this rock? Reduce the over spends. Tax at 20% for everyone including the rich and businesses.
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#12 Simon, you really have no idea. We watch every day as these idiots literally throw away millions then they want more from us, and you think we’re wrong to complain, seriously?
Why would we just ‘put up and shut up’ and agree to give more money to people who simply cannot handle it? Should we continue to ‘put up and shut up’ until they have us living on the street?
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So much for the consultation. An increase in GST can be implemented immediately. An increase in Income Tax over £100k will be introduced for collection in 2012. Looks like it’s GST then!
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12 Simon.Well why didn’t we think of that advice…with such staggering intellectual powers you must at least be a rocket scientist…
And still no comment from a politician as to whether the rainy day fund is still intact or been spent..was it ringfenced even…?
Come on speak up..
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@14 Grasshopper,
a petit vin rouge outside my future restaurant in Broons is calling.. you can join me!!
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Byyeeeee, I am off to Singapore and taking my hard earned salary with me. No plans to come back as fed up with it all!
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#22 LEAH HOLMES
Why would we just ‘put up and shut up’ and agree to give more money to people who simply cannot handle it? Should we continue to ‘put up and shut up’ until they have us living on the street?
#24 TRUTHSEEKER
Simon. Well why didn’t we think of that advice…with such staggering intellectual powers you must at least be a rocket scientist
Leah and Truthseeker, Do neither of you realise that NOTHING you say or do will change things? Conditions will only get worse. The island is unsustainable in every sense of the word. Too many people, too much greed, too much consumption, too much waste, too little respect for the island’s natural resources.
The island has ‘prostituted’ itself to the finance industry and has become sick as a result. Yes, this is a global financial crisis, but the sick and weak go first in an epidemic.
You may not like it, but Simon has said it as it is.
Personally I prefer ‘put up or get out’……. (I’ve tried both and am very happy with the latter)
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22 and 24 There isn’t a government in the world that hasn’t over spent in the last 10 to 15 years. If you think your guys are bad, just take a look at Greece.
Unfortunately it’s you lot that will pay for your politicians failures, something that is occuring around the globe.
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When the departments actually achieve cuts – where does the money saved go? It isn’t returned to the Treasury – it gets allocated elsewhere in the Department’s budget. EG Health Department will take on 3 new managers to “manage” the cuts!
So what is the actual saving in real terms ……Zilch!
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6000+ Civil Servants. 100k people. 50k Tax payers.
Lets get rid of 1000 Civil Servants – start at the top – If all were on wage of 20k then that would be your Twenty Million. Saved this year and next and the year after ad nauseaum.
If anyone can’t stomach that idea (especially Mr Corbel) then you will face a lifetime of tax rises and misery as the finance industry is NOT here forever, sacrifice a few to saver the greater good!
We need to cut costs. Rule 1 – People are the most expensive thing in a company – I have been made redundant 4 times in as many years, and I think people are living with the impression that they are OWED jobs.
Been there, seen that, paid my taxes, lost my house. Support from Jersey States – NONE!
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“22 and 24 There isn’t a government in the world that hasn’t over spent in the last 10 to 15 years. If you think your guys are bad, just take a look at Greece.”
One of the points that you may not know about is that our governent is full of accountants, businessmen, etc and one of their main claims to office was their supposed ability to manage money.
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this bombshell(for the ordinary working person), should of been delivered with a sombre looking photo and not a smile / grin.
there is nothing to smile about here, unless you have a full up bank account and are well off.
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Simon, the problem over here is the cost of living is very high and it just gets higher. Just look at the price of a property, they are in the main London style prices or at least for luxury style prices that you would get a lot more for your money in the UK outside of London, and Greece possibly in most places.
The price of a locally produced loaf of sliced bread is over a quid and litre of local milk is about a quid. Practically any fee you can think of is on average more than in the UK, i.e. Doctors (mine 35 quid for 5 minutes), Dentists, Builders, Plumbers, Solicitors, Mechanics the list is endless. Probably because everyone wants to be able to afford a home that is so expensive they charge outragiously compared to their UK counterparts.
Yes, you may pay 40% but after the costs of everything here the average person who is middle earning does not get much disposable income because of the cost of general living here.
Our tax system is so inept that you can go a year paying as you earn, albeit a year behind and find that they have not deducted enough from your wages so the next year it goes up by 50% because they dont know how to use a calculator.
While I see your point, there is a lot of moaning when things could be a lot worse I understand why, many people are so fed up with the missmanagement of our taxes.
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Doesn’t bother me, I don’t earn enough to pay tax lol
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#27 Canoe, we don’t all have the option to get out at this very moment, but glad it’s worked out for you. Very occasionally when the people speak someone does listen, it might be rare but you never know when it might happen. I totally agree with you about where it’s gone wrong, I agree about too many people etc etc, but the only thing that definitely won’t change things is saying nothing. I’ll stick with letting the politicians know my opinion, just in case someday they do listen.
It seems to me it can only be their inflated ego stopping them from realising that the people living on the island are the ones with the answers, and some of us do not mind paying more tax but only if we can trust them with it.
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Over and over again, it screams the fact this island is run by multi million greedy businessmen who only look after themselves and their kind.
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simon (12) You lot make me smile. I live in the UK and pay 40% income tax, and soon to be 20% VAT – just put up and shut up
Yes ‘simon’ and I am happy to send a few of your sub-20% tax payers back to you too. Make us all smile.
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Suppose that every day, ten men go out for beer and the bill for all ten comes to £100. If they paid their bill the way we pay our taxes, it would go something like this:
The first four men (the poorest) would pay nothing
The fifth would pay £1
The sixth would pay £3
The seventh would pay £7
The eighth would pay £12
The ninth would pay £18
The tenth man (the richest) would pay £59.
So, that’s what they decided to do.
The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve ball. “Since you are all such good customers” he said “I’m going to reduce the cost of your daily beer by £20.” Drinks for the ten men would now cost just £80.
The group still wanted to pay their bill the way we pay our taxes.
So the first four men were unaffected. They would still drink for free.
But what about the other six men — the paying customers? How could they divide the £20 windfall so that everyone would get his fair share?
They realised that £20 divided by six is £3.33. But if they subtracted that from everybody’s share, then the fifth man and the sixth man would each end up being paid to drink his beer. So, the bar owner suggested that it would be fair to reduce each man’s bill by a higher percentage the poorer he was, to follow the principle of the tax system they had been using, and he proceeded to work out the amounts he suggested that each should now pay. And so:
The fifth man, like the first four, now paid nothing (100% saving)
The sixth man now paid £2 instead of £3 (33% saving)
The seventh man now paid £5 instead of £7 (28% saving)
The eighth man now paid £9 instead of £12 (25% saving)
The ninth now paid £14 instead of £18 (22% saving)
The tenth now paid £49 instead of £59 (16% saving).
Each of the six was better off than before. And the first four continued to drink for free. But, once outside the bar, the men began to compare their savings.
“I only got a pound out of the £20 saving” declared the sixth man. He pointed to the tenth man “but he got £10!”
“Yeah, that’s right” exclaimed the fifth man. “I only saved a pound too. It’s unfair that he got ten times more benefit than me!”
“That’s true!” shouted the seventh man. “Why should he get £10 back, when I got only £2? The wealthy get all the breaks!”
“Wait a minute” yelled the first four men in unison, “we didn’t get anything at all. The new tax system exploits the poor!”
The nine men surrounded the tenth and beat him up.
The next night the tenth man didn’t show up for drinks, so the nine sat down and had their beers without him. But when it came time to pay the bill, they discovered something important. They didn’t have enough money between all of them for even half of the bill!
And that, boys and girls, journalists and government ministers, is how our tax system works. The people who already pay the highest taxes will naturally get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas, where the atmosphere is somewhat friendlier.
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38 Rob,
Yes, I have seen that particular idolised version of events to explain tax, unfortunatly, its just not applicable to Jersey.
If you apply your version to Jersey, The tenth man (the richest) would make an aggreement with the owner to only pay £2.00 instead of £59.00 and when he moved away, he would finde that all the other places would charge £400.00 for the same service.
So Yes, we can tax the wealthy here a little more than the barest minimum they get away with.
Will they all move away? Where to? not anywhere in Europe where they would be taxed far, far more than they do here.
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I’ve had enough too!
Perhaps now is the time we the public had a voice and demand to be heard!
Can anyone reading this set up an on-line voting system so the public can vote to elect which (if any) ‘minister’ we keep or lose?
A simple list showing names of current ministers with a yes/no option, with a couple of spaces at the end, one to insert the name of anyone we would like to see in there and one for general comments.
Could we also add the question: Would you like to see all states members elected by the public in future?
Could be a start – yes?
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But the principle is valid.
They will go…somewhere…and of course the indirect benefits will go with them.
It is a balancing act and unfortunately most on here only see the ‘tax the rich’ solution.
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So here’s the sucker punch. The elephant in the room is States spending. +£180m over the last 5 years alone (=+40%). The Minister, although brave, has just not been able to do enough to tame this monster. Imagine what the entrepreneurs and private sector could have done with that sum. But no, we continue to drag the economy and wealth creation down with spending which is largely out of control.
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@Rob 38
This is excellent story – it is really a shame that so few people understand it.
Even worse is the fact that those who don’t understand it (9 out of 10 in your story) have the same voting power. It is a pity they have the same voting power not having the same ‘thinking’ capability.
Let’s make voting power proportional to the taxes paid: each pound paid in taxes and not claimed back in benefits = 1 vote. That would be truly fair, and self-stabilising system.
For example – if rich one vote to not to pay the tax we would end up with NO voting power…
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#38 And so their job will be vacant for someone else to take, at the same salary, and that person will pay the same tax.
Unless of course they don’t work and only pay tax due to 11k status, in which case apparently they pay a lower percentage than many of us anyway!
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#44 Leah
It’s not the single job that goes and gets replaced. With the wealth that leaves the island the jobs that manage that wealth go, not to be replaced as there is no demand. so you now have less people paying tax – a greater black hole to fill which no-one wants to fill and so we all shout for the ‘rich’ to fill ALL of that gap and they so no – I WILL take my wealth elsewhere – and so the cycle begins again. As the saying goes be careful what you wish for….
It has to be BALANCED – we can please all of the people….some of the time. This needs to be one of those times.
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#41 Rob,
Sorry, but your story in #39 is simply rubbish, the principle isnt valid and is not even related to the situation.
What you have discribed is a small community who all pay a tax based on their income, where the poorest half of the population earns less than 1.7 percent of the earnings of the richest person.
At the end of the tax year, there is a surplus of funds in the treasury. You are suggesting that the richest person leaves the community as they do not get the largest sum in benefits paid out.
This story has nothing to do with Tax increases, but stangely, how the rich would leave if the government don’t pay them to stay.
I suppose, in a round about way, it is valid to the 11k system
What most people in Jersey want, is for the people who earn the most to actually pay their fair share of tax. We don’t all demand that they pay a higher percentage, only that its fair.
GST is not a fair tax, it taxes people on life, not on their wealth. I earn approximately half of what one of our deputies are paid. I pay GST on everything I buy, and so do they. Do they wear twice as many clothes as I? Do they eat twice as much as I? Are they sick twice as much? Do they pay twice as much GST as me? Now, taking out the expenses for basic living, do they have exactly twice as much money left over as I.
Now, take one of our civil servants on 100k. Do they eat four times as much as me and so on, after expenses, do they have only four times as much money left over for luxuries and holidays, or is the total somewhat more. If income tax was the only tax, and it was taxed evenly, then everyone would pay the same amount and it would be fair.
What is not fair is that the wealthier you are, the less you have to pay as tax as a percentage.
This is why most people in Jersey want to tax the wealthy more. We want to tax them fairly, the same as the rest of us.
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#46 Thirtysomething
I fully understand your point and actually agree with it in principle. However the reality is that if we do that without finding the right balance the ‘Wealthy’ simply wont be there to tax. It is very simple to move huge amounts of money to other parts of the work very quickly nowadays – and that money, which breeds money, which generates tax will dissipate, ‘leak’ if you will from the Jersey economy at a rate far quicker than the Treasury/Tax systems can adapt to.
By the time the leaks are controlled, there will be a bigger (per capita) gap to plug – so what then? Tax the wealthiest? Same cycle…
Returning to your point – I emphasise I agree but it needs to be addressed in a balanced way – not simply take the 10th man outside and beat him up.
P.S. The story is simply meant to highlight the dicussion of actual versus %age and then to initiate debate on the concequences thereon.
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Assuming Jersey is similar to the UK then I think you’ll find that the top 5% of earners pay 55% of the tax take.
Besides when the multi-millionaires goes to the supermarket they’re not asked to pay extra for their food because they can “afford to.”
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40 Ann ..what a fabulous idea…pleasee let it be known …as we need a bigger voice a united voice.we had a 6/700£million Rainy day fund…a mere 22m from that would hardly dent it,and the public have long been lulled into a false sense of security believing it to be ther,,I have asked about it ad nauseum..no answer came the stern reply…you know why..? they’ve spent it..the cupboard is bare and Walker.Le sueur and Ozouf were at the helm at the time.Imean how much rain would it take..? No it’s Gone.
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Rob 38
Nice “textbook” story, but if the “drinks” bill wasn’t so high in the first place then eall 10 may have been able to pay their equal share.
Personally, I feel that those who are the main drain on the tax purse (i.e. those who commit crime, laze off work on benefits, squeeze out babies they cannot afford and do not take good care of themselves) should be more accountable for their actions.
Money, services etc should NOT be handed on a plate to these people at OUR expense!
Maybe if the government didn’t throw away our money without seemingly realising where it was coming from then maybe our tax system would at least feel a lot fairer than it does now.
I for one am fed up of working my backside off only to see Joe Lazi*rse lead a more rewarding lifestyle with my hard earned!
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Having gone to one of Sentor Ozoufs tax consultation meetings – it was quite clear to see that they do not want the public’s views – they are just going through the motions. There were 4 alternatives to raising taxes – two of which are so extreme they will never be voted in and were highligted as “negative”:-
1)Increasing the Soc Sec cap From ~ 45,000 to £115,000
2)Increasing income tax to 30% for over £110,000 earners.
The remaining 2 favoured increases (which will hit hard lower and middle Jersey) were raise GST to 5% and triple parish rates.
At this meeting it was quite clear to see that Mr Ozouf was the tail being wagged by the dog The dog being certain top civil servants and Mr Finance and Mr 1.1K.
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Lets be clear on my views.
I’m not against the rich being rich.
I’m against the constant mismanagement being shown in spending our taxes!
If you have 10 pounds and spend 11 – misery!
If the powers in Jersey have 10 pounds they’ll spend 15 because all they have to do is rob more from those tax payers who have already had to cut their cloth.
There is constant talk of further spending in the States.
My point is, if you doon’t have it, you can’t spend it. Rather than look at ways of raising more money, just stop all this unnecessary spending!
Surely, with all the qualified accountants we have in Jersey, one would be able to manage our money better than all these numpties put together!
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#45 Rob, the assumption is with lots of people leaving Jersey the island would be a worse place. We simply cannot know that. It would be a different place, and per head of population it may be financially poorer, but that still doesn’t necessarily mean worse. With a lower population it could well be a better place in many ways that are currently a financial cost to the island. Thing is some people here want city resources on an island with £100k, that’s not possible and you shouldn’t live here if you’re not willing to accept that, say, the hospital will be minus some departments and specialists you would have in the UK etc etc.
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#53 Leah
I don’t disagree with the sentiment – we are over-crowded and we spend way too much per capita (gov spend) and I am all for bridging the gap by cutting the costs rather than raising the taxes.
Your average man in the street won’t accept that though – most want cake and eat it. Greece springs to mind.
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#54 Shame we can’t get the States to agree
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The 30% tax rate on incomes of £100k applies to household income, not individuals. So a single person earning £98k pays a maximum of 20%, whereas a coupel earning £51k each end up on 30%…. Bit strange!
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@56 Real Truthseeker
It works little bit different actually. Everything up to 100k is taxed @ 20%, and everything above 100k is taxed @ 30%, so couple earning 51k each will end up at 51k*2=102k, tax: 100k * 20%=20k + 2k * 30% = 0,6k = 20600, which will give effective rate 20,6%. Tax will be lower in reality due to various allowances.
Nevertheless I fully agree that 30% income tax will cause more damage in longer term than benefits. Rich people WILL go elsewhere. Perhaps ones earning 120k or 150k will not, but bigger difference, or bigger potential saving then bigger temptation and bigger profit in moving and hiding part or total of your income abroad.
People from abroad are hiding their income from external jurisdictions behind Jersey based trusts, and Jersey based trusts are transparent to Jersey authorities. If savings are big enough, bigger than yearly cost of running trust then Jersey people will do exactly the same. So who will loose then ? Middle Jersey of course. Poor (and often lazy) will claim their benefits, rich will move away. There will be less money for everyone and everything in longer term.
Instead of looking at increasing taxes do what UK government did – CUT SPENDINGS. Cut benefits, cut admin staff. Who said that poor must live in 3 – 4 bedroom houses at taxpayer expense just because they have children ?
Why those who DO care about themselves and their own children are FORCED to finance LAZY b…s ?
We should help poor to get out of poverty but NOT by PAYING for them cost of their live. If they want to get benefit – fine, but they should return something to community in exchange – their WORK. So rather than giving away taxpayer’s money better organize some work for those who wand to live from benefits. Benefits SHOULDN’T BE easy profitable way of living. They should be LIMITED in time. OK someone can get benefit if one really needs it but not to permanently live on it, just to start another live on his/her own. Cannot do this is say two years ? – Sorry – no bonus live.
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Cut back spending – For example do we need to pay £100k plus for warnings on global warming and sea level rise – taken straight from google? If we were to cut every civil service post where the incumbent goes off on a tangent – instead of employing additional managers to cover the work this would be a good start.
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