A simple tax regime competitive with other low tax jurisdictions

Keeping a lid on taxes – Guernsey needs to remain a low tax jurisdiction, and the previous administration was looking to increase taxes to pay for out of control spending and an eye-watering loan. The government was looking to introduce Goods and Services Tax (GST) to plug a black hole that has been caused by irresponsible spending without deciding where the funds will come from. You cannot keep increasing taxes every time you want to spend money. The funds need to come from somewhere and hence economic growth being so key. We will soon end up with GST, IHT, CGT, higher personal taxation, lower personal allowances and other taxes, if the previous administration carries on the way it did without checks and balances to robustly stop them.

When considering alterations to any tax regime we need to look to other low tax jurisdictions to remain competitive. The proposal by the previous P and R committee reduces Guernsey’s fiscal competitive advantage over its neighbour, Jersey, and ignores the growing competition of other jurisdictions. These now include jurisdictions which are not known for low tax but are offering such packages to individuals and businesses, such as Italy, Portugal and New Zealand where further measures to attract international businesses and individuals are being discussed.

Growth is the only sustainable way that the increasing burden of health and age of the current population can ultimately be paid for.