About 100 people protest against GST package

More than 100 protestors gathered outside of Guernsey's Royal Court in opposition to plans to introduce a goods and services tax.

A petition against P&R's tax package with more than 9,000 signatures was also handed to deputies before they entered for a debate on Policy and Resources' tax plan.

Petition organiser Chris Murray said he hoped the petition would show deputies the strength of feeling against P&R's package, but said he "doubts it will make a difference" to the debate.

Business groups like the Institute of Directors have lobbied deputies to make a decision on tax reform during this sitting of the States.

In a letter to deputies seen by the BBC, the Institute of Directors (IOD) has called on politicians to make a decision at the States meeting which started on Wednesday, and back Policy and Resources' tax package proposal.

The Guernsey Retail Group has warned a goods and services tax (GST) will damage local businesses, while the Chamber of Commerce has stressed the need for both tax reform and spending restraint.

P&R has proposed a 3% GST, a lower rate of income tax, higher income tax allowances, social security contribution allowances, the re-introduction of motor tax and higher taxes on companies, which it said would raise £36m a year.

Loraine Mealing said she attended the protest because GST is a regressive tax and she believes the rate will increase in the future.

P&R has said the regressive nature of GST will be mitigated by its changes to income tax and social security which officials say will mean lower earners will be better off under this package.

Deputies voted for a proposal from Forward Guernsey by 26 to 13, to limit speeches during the debate on tax reform to five minutes and seven and a half minutes for closing speeches, in order to get through business quicker.

The tax package from P&R is subject to more than 40 amendments, which will need to be debated before a decision is made.

Moves to increase the rate of income tax to 22%, have a referendum on P&R's tax package, tax underused properties, reduce Guernsey's contribution to overseas aid and exempt food from a future GST make up some of the proposals to change P&R's plans.

Protestor Ian Timms said: "I would like to see the States of Guernsey sort their income tax out and get the money they are owed before introducing any new taxes."

Earlier this month the States admitted the backlog at the revenue service was far worse than previously disclosed, with more than 100,000 returns still to be assessed.

As deputies arrived at the States pro-GST politicians were heckled by the crowd, with members of P&R booed as they arrived at the Royal Court.

Chris Renouf who atttended the protest said he supported a higher rate of income tax and changes to income tax allowances, alongside changes to the tax cap.

In his letter to deputies, IOD chair Glen Tonks, said: "Finish the job and take the final vote in this sitting.

"Any amendment which seeks to defer a decision, reopen settled questions, or push the final vote beyond this sitting is directly contrary to the objectives of fiscal stability, economic growth, and responsible governance.

"Indecision is not a neutral outcome; it is a tangible financial cost borne by the community."

If the debate does not conclude at this week's States meeting it will resume on 21 October.

The Guernsey Retail Group has encouraged the States to focus on economic growth alongside any tax reform.

It said: "Taxation can raise revenue from the economy Guernsey has today. Growth is what will strengthen the economy and tax base Guernsey will depend upon tomorrow."

Guernsey's Confederation of Industry has backed plans from some deputies to increase the rate of income tax to 22%.

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