Friday 29 September 2023
The Policy & Resources Committee is reassuring businesses concerned about the possible administrative workload that could come from a Goods & Services Tax.
Nearly all developed jurisdictions around the world have some form of Goods & Services Tax, including Guernsey's nearest neighbours Jersey, meaning it is possible to look at many examples for how the administration of the tax can be managed, and where it is kept simplest for businesses.
The Committee has prepared an 'example' tax form. This is based on similar jurisdictions' forms, and while it is not the final version of what would come in should the States support the Committee's sustainable tax package, it is hoped it will give businesses an idea of how short and simple the form is likely to be.
Recently, the Committee highlighted how non-finance businesses with turnover below £300,000 would not be obliged to register for GST if they found it was more cost-effective for them to avoid the administration (see: P&R says more than 50% of non-finance businesses won't need to register for GST - States of Guernsey (gov.gg)). But for businesses that choose to register, or those who would be above the proposed threshold, the administration would also be kept very simple.
The Committee believes it is likely the form would involve just a few questions, and be no more than a single page. The example form issued today reflects this.
Deputy Mark Helyar, Vice-President of the Policy & Resources Committee said:
"In many jurisdictions, businesses are very used to accommodating a consumption tax and it causes them very little in terms of additional administration. But I appreciate that this would be new for Guernsey businesses, and because of that there's concern it would be a bigger and more cumbersome task than it really is.
That is however on the basis that we introduce a broad-based consumption tax with relatively few exemptions. This not only means we can keep the rate of the tax itself lower, but it keeps the administration simpler too.
Of course the final version of the form would only be agreed if the States supports the sustainable option in the Funding & Investment Plan. But we thought it still useful to give people a good idea now of how it's likely to look, and I hope that's helpful."
You can find the example as a PDF in the Downloads section of this page.