Attempt to bring in temporary income tax hike then GST to Guernsey

Policy and Resources and deputy Peter Roffey agree a compromise to plug a financial deficit that's worsened by £100M over a year, according to the committee.

The last minute amendment, to an expected four days of budget debate, is a package containing both income tax and 'GST Plus.'

Deputy Lyndon Trott, who heads up the Policy and Resources Committee, says a 2p increase in income tax over two years is necessary to plug a deepening financial hole:

"‘During the lead up to the Budget debate, our Committee has sought to focus on the urgent need to generate cash in the short term. That is our priority and must be the priority of this current Assembly. It would simply be irresponsible to hand over to the next States such a precarious financial position."

"A temporary increase in the personal rate of income tax generates £55m over the next two years that can be invested."

Last minute discussions with deputies, including Peter Roffey, have resulted in an amendment that would see the tax rise for two years superseded by a wider tax gathering initiative called GST Plus. Deputy Roffey says he sees voting for an income tax rise as a necessary compromise:

"I have made no secret of my extreme reluctance to support any increase in the personal rate of income tax, but at least this package ensures it would be for two years only before the wider tax package kicks in."

"I appreciate how far the Policy & Resources Committee has moved by proposing to invest significant sums in preparation for GST Plus to be introduced in 2027, with that in mind it seems only right to reciprocate."

Any move to introduce GST will be opposed by deputy Carl Meerveld and his supporters, who will hold a protest on the court steps before today's debate, 5 November:

"They fear, as I do, that as soon as it is introduced, there will be inevitable increases and we will carry on overspending what we can really afford, rather than making cuts, potentially in services, to live within our means."

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