As published on jerseyeveningpost.com, Monday September 2, 2019.
JERSEY’S tax system is to be the focus for a new policy development board – and considering ways to raise taxes for Islanders is among its priorities.
Corporate tax, however, does not come under the remit of the Revenue Policy Development Board, the creation of which has been signed off by Deputy Chief Minister Lyndon Farnham.
The body will be jointly chaired by Chief Minister John Le Fondré and Treasury Minister Susie Pinel. Its members will also include Social Security Minister Judy Martin, Assistant Environment Minister Gregory Guida and St Mary Deputy David Johnson.
They will work alongside Treasury director-general Richard Bell, officers from the Tax Policy Unit, Strategic Policy, Performance and Population and the Economics Unit as well as a number of lay members to be agreed by the joint chairs.
It is the latest PDB set up by the Chief Minister since his election last year and has two main aims:
lReview and consider changes to the current structure and incidence of taxation, contributions and charges.
lShould revenue raising be required to fund public services, to consider policy options to ‘materially increase revenues, having consideration for the long-term tax policy principles’.
The report accompanying the ministerial decision says that the Treasury Minister is currently undertaking a review of the Island’s personal income tax system on a ‘revenue neutral basis’. The work is focused on removing the current archaic aspects of the system.
In the 2019 Budget ministers said they planned to explore revenue raising measures to achieve environmental objectives, particularly in light of a climate change emergency being declared.
And the report states: ‘According to information provided in Budget 2019, the Government of Jersey is projected to run an annual deficit (after depreciation) of approximately £30m to £40m over the period to 2023. Whilst there are plans being finalised to reduce this deficit through the delivery of efficiencies, this scale of deficit is before any additional investment in Common Strategic Plan priorities and funding to modernise and transform public services.
‘In the event that these calls on funding exceed income forecasts, one option available to government is to amend existing revenue raising measures and/or introduce new revenue raising measures in order to increase the “total States income” and correspondingly reduce the possible deficit.’
It adds: ‘Any changes relating to revenue raising measures are, by definition, highly politicised and hence the board will need to provide clear political direction on the measures considered.’
The Revenue Policy Development Board is to start work immediately and will support the work of the Government Plan, which is due to be debated in the autumn. It is anticipated that the board will then continue and support future Government Plans.
Minutes of its meetings will be published, according to the report, ‘as soon as practical and appropriate, subject to the relevant Freedom of Information exemption concerning policy under development’.