Guernsey GST proposals dominate States' sitting

Policy and Resources Committee (P&R) proposals include a 5% GST alongside a new rate of income tax for some people

A fifth option for reforming Guernsey's public finances has been proposed as politicians discussed the introduction of a goods and sales tax (GST).

Politicians on Wednesday voted to debate a range of proposals in the coming days that look at how public services in the future can be funded.

The introduction of a 5% GST is the preferred proposal put forward by the Policy and Resources Committee (P&R).

But the proposal has been met with fierce resistance.

LISTEN: Live coverage of the States of Guernsey meeting

About 60 anti-GST protesters gathered outside the States building in the latest demonstration against the plan.

P&R said it believed more money was needed to sustain public services.

However, Deputy Peter Roffey put forward an Option E to "avoid the States emerging with nothing" if all proposals are rejected.

The plan includes higher property taxes, charges for motorists and social security reform to raise up to £55m this political term.

Protesters have gathered outside the States building

The rest of the projected deficit would be dealt with by the next States assembly, elected in June 2025.

Deputies Heidi Soulsby and Gavin St Pier have also put forward an alternative proposal to the plans from P&R.

Option D from Ms Soulsby is for a two-stage approach, with the first stage including around £4m worth of budget cuts, a £400 increase in income tax allowances and taxes on business parking.

P&R plans also include a new 15% rate of income tax for earnings under £30,000 as well as higher income tax allowances and social security contribution reforms on top of a 5% GST.

The committee said the reforms were needed as people were living longer and services like those within Health and Social Care would need to be used more by islanders.

Two alternatives put forward by the committee are a Plan B - which would involve charges such as paid parking, £16m of budget cuts and higher social security contributions; alongside a big hike in property tax - and a Plan C that is £31m worth of cuts.

The proposal that includes the GST is Plan A and P&R's preferred option to bring the island's finances to a sustainable footing.

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