Call to return 'surplus' tax revenue to residents

The Manx TaxPayers' Alliance said £473 per taxpayer should be returned

A lobby group has called for £21.3m of tax revenue that was above the estimated take by Isle of Man government in the last financial year to be returned to residents.

Government accounts for 2024-25 revealed income tax revenue had outperformed expectations due to higher interest rates improving returns for savers and increases in wages.

Michael Josem of the Manx TaxPayers' Alliance said the authorities had "already funded everything it planned to" so the "surplus" of £473 per taxpayer "belongs in their pockets".

But Treasury Minister Alex Allinson said the money would instead go "back into reserves to pay the bills".

In a statement the alliance suggested that the money could provide "significant relief during current cost-of-living pressures" if returned.

It had the potential to help "with energy bills, grocery costs, or savings" and would not require any cuts to planned government services, it said.

Mr Josem said the money "wasn't planned for" and "isn't needed for any specific purpose".

"When government takes more than it needs, it should give it back," he added.

'Long-term plan'

Responding to the call, Allinson said it would be "easy for a treasury minister to have giveaways" but he was "not minded to do that".

He argued that the department had already "put money in working people's pockets" by increasing child benefit thresholds and personal allowances, and changing national insurance thresholds in the 2025-26 budget.

The minister confirmed the department planned to "use this extra to reduce the amount were going to have to take out of reserves" in future.

Reflecting on the data, he said the government had been "spending more money on services than it had been bringing in over the last decade" so the money would help to "balance that out".

Allinson said the Treasury was also looking to control public sending by working with departments to bring them in on budget, with the only overspend in the previous year being at the Department of Health and Social Care through Manx Care.

Alongside aims to reduce the headcount in public services, the moves could be described as "responsible long-term economic planning rather than short term fixes", he said.

He said while it was "welcome news" that the Isle of Man economy was in a "strong and resilient" state, "you cannot take for that for granted".

"You have to have a long-term plan to balance the budget and to control government expenditure," he added.