Guernsey businesses hit out at GST proposals

Guernsey's Policy and Resources Committee says it has forecast an £80m deficit, because of the pandemic as well as the cost of an ageing population.  Credit: ITV Channel TV.

Businesses in Guernsey have hit out at proposals to introduce GST for the first time. 

The plans which could see the introduction of a Goods and Services Tax of up to 8% are due to be debated and voted on at next Wednesday's States meeting (September 29). 

Guernsey's Policy and Resources Committee says it has forecast an £80m deficit, because of the pandemic as well as the cost of an ageing population. 

But the proposals have been criticised by businesses who say it will damage their trade and increase the cost of living. 

The tax review which will be debated on 29 September, will consider these three options:

  • Option 1

- Apply an income-based health tax at 3%.

- Change the Social Security system and use this to raise more money.

  • Option 2

- Apply GST that will gradually increase to up to 8%, with measures to protect low-income households.

- Increase the personal income tax allowance.

- Change the Social Security system but without raising any more money.

  • Option 3

- Apply GST that will gradually increase to up to 5%, with smaller measures to protect low-income households.

- Make a smaller increase in the personal income tax allowance.

- Change the Social Security system and use this to raise more money.