Jersey To Face 'Inevitable' Tax Hikes Says Economic Report

by Robert Lee, Tax-News.com, London

13 August 2003

An economic plan released by the Jersey Policy and Resources Committee this week has warned that tax hikes for residents will be 'inevitable' in the years ahead with the government committed to the goal of reducing corporate tax to zero per cent.

The document outlines the financial plans for the States up to 2008 and makes provision for cuts in spending and capital projects. However, Finance Minister Terry Le Sueur has said that the taxpayer will have to bear some of the burden for closing a £100 million gap that has opened up in the island's public finances.

It is anticipated that there will be £7 million worth of tax increases in the 2004 budget, though there are no specific details as to how this will be done. However, the Finance Minister has said that there will be no further tax increases until 2009, according to the Jersey Evening Post.

Senior officials from the Policy and Resources department including president Frank Walker and the Employment and Social Security committee participated in lengthy discussions back in June on the tax options available for the island. Several measures have been mooted to increase the government's revenue stream including a sales tax and property tax as well as changes in income tax rates and allowances and the scrapping of mortgage interest tax relief.

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