Institute Of Directors Calls For 10% Sales And Income Tax In Jersey

by Harry McRandle, Jersey Evening Post

20 April 2005

This story is reproduced by kind permission of the Jersey Evening Post at http://www.thisisjersey.com

A ten per cent sales tax and ten per cent income tax rate would be a fairer and simpler way of plugging Jersey's projected tax shortfall of up to £100m annually, says Institute of Directors chairman Andrew Lewis.

Mr Lewis said that if sales tax was set at ten per cent rather than the three per cent proposed, there would be plenty of money available to introduce exemptions for essential goods and services, as well as fully fund a comprehensive income support scheme.

At a lunch last week, Mr Lewis outlined IoD policy for a higher-rate sales tax. He also said that a ten per cent income tax rate would make Jersey more competitive compared to other international financial jurisdictions. And he argued that although in principle a higher rate of sales tax would appear to be regressive, it followed by the nature of the tax that those who spent most paid most.

He said that at a rate of ten per cent the Island would collect about £150m a year if Finance's calculations of collecting £45m at three per cent were correct.

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