GST could hit 5% in just 2 years, CM admits during awkward Alderney grilling
GST could go up as soon as 2030 – just two years after it is due to be introduced in 2028, Guernsey’s Chief Minister admitted.
Questioned by members of the public during a heated public meeting in Alderney this week, Deputy Lindsay de Sausmarez acknowledged the next States would review the tax reforms in 2030, with “further measures” on the table if they hadn’t fixed the Bailiwick’s finances – including raising GST to 5% or higher.
While the possibility of GST being raised in 2030 is mentioned in the tax policy letter Policy and Resources (P&R) published last week, this appears to be the first time it’s been highlighted outside of the paper – either by a politician or in any media releases.
Grant Scriven, a former banking executive with experience advising international governments, called Deputy de Sausmarez’s answers “terrifying, frankly”.
He told Express: “Anyone with an ounce of intelligence could have seen – [the way the numbers work out], you can’t do anything other than raise the tax.
“If she’d been in front of me looking for any kind of financial support from my bank, I’d have shown her the door.”
Opposers caused residents “embarrassment”
Deputy de Sausmarez said her meetings in Alderney – including with local politicians and a public meeting organised by the Chamber of Commerce – were “all useful and constructive”.
“There were some excellent questions and – with the possible exception of a couple of people at one of the meetings who were vocally oppositional, which didn’t bother me but seemed to cause a few of the full-time Alderney residents some embarrassment – people were interested in understanding the problems this package is addressing and why we are recommending the particular measures in the tax reform package,” she reflected.
She added that it had been “helpful” for her to hear about cost-of-living pressures and demographic differences between Alderney and Guernsey.
“Death tax”
Alderney artist and writer Bennt Bengtsson was among those to confront Deputy de Sausmarez – in his case, while holding a large sign calling GST a “death tax” for the islands.
“The fact is that GST will be the future main tax tool in the tax box… and the easiest way to raise taxes without ever consulting the taxpayers in the future,” he said.
“You will just wake up one morning to a higher GST tax rate and there is absolutely nothing you can do about it!“
He claimed that “most people in Alderney” did not want GST.
Crisis of ambition
Mr Scriven also publicly challenged Deputy de Sausmarez on P&R’s “low” growth assumptions, which predicted 0.5% growth for the Bailiwick, which he called “a crisis of ambition”.
He said: “If you look at Guernsey’s problem as presented by her, her numbers [show] a financial model that says there will be no growth – that to me is the real story here.”
“Half a percent is not growth – it’s negative.”
He called on Deputy de Sausmarez to adopt a more positive and entrepreneurial mindset, by asking: “How am I actually going to create wealth and growth?”
He argued that a business owner facing shrinking revenue would look for ways to grow their business, rather than charge existing customers more, and said the Bailiwick should try to stimulate economic growth.
He added: “What you actually have is a bashed economy with a leader who’s got no ambition.
“She’s got zero confidence and ambition for the future of Guernsey.”
A spokesperson for the States said the tax policy letter “clarified” P&R’s position on the 0.5% growth rate and explained “the role growth needs to play”, in section 6 of the document.
