GST proposal for Guernsey to be 6% and not include food

Policy and Resource's plans for a 5% GST alongside higher income tax allowances were rejected in February

Policy and Resources say no decision has been made on final proposals to raise more money to fill Guernsey States' financial deficit.

Some deputies have said a 6% goods and services tax (GST), not applied to food, will be put forward next month.

Guernsey's Policy and Resources (P&R) Committee could include it as one of the options to help raise an extra £4m a year to fund government spending.

A spokesperson for P&R said none of the options had "been finalised or agreed".

"The Funding & Investment Plan is in the process of being developed, and the options it will include will now be informed by the States decision on Tuesday to support the Government Work Plan mid-term reset," the spokesperson said.

"The funding options will be accompanied by proposed options for the capital projects the States prioritises, and it's absolutely essential that whichever option the States favours is financially sustainable."

The funding and investment plan is set to be published on 14 August for debate in September's States meeting.

Vice-President of P&R, Deputy Mark Helyar, has warned other options may include paid parking and changes to income tax rates.

In February 2023 deputies rejected a package of measures for tax reform which included a 5% GST, a lower income tax rate and reforms to social security contributions.

A package of tax reforms put forward by former Chief Minister Deputy Gavin St Pier and former Deputy Chief Minister Deputy Heidi Soulsby was also defeated earlier this year on a tied vote.

It included cutting spending, reviewing government business and taxing cruise ship emissions.

The last attempt to introduce GST attracted protests outside the States and along the seafront.

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