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Jersey tax expert says Guernsey's planned GST will ultimately benefit the island
Overview
A Jersey tax consultant has stated that Guernsey's decision to introduce a 3% goods and services tax (GST) from 2029 will ultimately benefit the island, despite initial unpopularity. Drawing on Jersey's experience with its own GST introduced in 2008, experts noted that it has contributed significantly to Jersey's economy and provided a simple administrative alternative, while highlighting lessons around tax rates and exemptions.
Key points
- Jersey tax consultant John Shenton said Guernsey will benefit from introducing a 3% goods and services tax (GST) from 2029.
- Shenton acknowledged that while people will initially dislike the tax, similar to Jersey's experience in 2008, populations typically adapt to it over time.
- He noted that not exempting food from Jersey's GST kept the overall rate lower at 5% rather than approaching 10%.
- Shenton stated that GST has added about £1bn to Jersey's economy over the past 18 years, serving as a relatively simple and easy-to-administer alternative.
- Former Jersey politician Kevin Lewis advised Guernsey's government to pick a rate and stick to it, warning that voters will not forgive rapid tax increases.