UK's VAT relief-rate decision 'puts Guernsey jobs at risk'

Guernsey's unemployment rate could be set to rise further, after hitting a 15-year high last month.

A UK Treasury decision to end VAT relief in the Channel Islands could mean further job losses, Deputy Carla McNulty Bauer fears.

She told BBC Guernsey: "The trends are going in the wrong direction... We could see greater increases in unemployment in the next few months."

In February, 619 were out of work or receiving employment-related benefits.

Deputy McNulty Bauer, Commerce and Employment Minister, said the outcome of a judicial review into the UK Treasury's proposed abolition of Low Value Consignment Relief would greatly affect future figures.

The ending of the VAT relief, from 1 April, is specifically targeted at goods imported to the UK from the islands.

A High Court decision on a challenge by the governments of Guernsey and Jersey is expected later this month.

The Commerce and Employment Department has estimated 650 people are employed in the island's fulfilment industry, which includes receiving, warehousing, repackaging and sending products.