Jersey Rules Out Tax Hikes In Response To Brexit
by Jason Gorringe, Lowtax.net, London
27 September, 2016
Jersey will stick with its medium term fiscal plan despite the UK's decision to leave the European Union and a predicted slowdown in tax collections.
The Fiscal Policy Panel said there will be a slight slowdown in the economy in the short-term and a reduction in revenues of GBP6m (USD7.8m), or one percent of gross domestic product, from 2017 onwards, mainly as a result of lower personal income tax collections.
Nevertheless the Panel has recommended that that there should be no change to Jersey's existing medium term financial plan.
Commenting on the Panel's advice, the island's Chief Minister, Ian Gorst, said: "The Fiscal Policy Panel's advice is clear - we have a plan and we should stick to it. The Brexit vote has added additional uncertainty to the local economic climate but we must ensure that we do not take knee-jerk decisions and thereby add to that uncertainty."
The Treasury Minister, Alan Maclean, said: "We will be proposing to States members that no change is made to the package of proposals at this stage but that a further withdrawal from reserves be considered in 2018 if required to support the economy at that point. This is consistent with the Panel's advice ... to use reserves rather than propose more measures to raise money or reduce spending."
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