- Reform Jersey want to raise up to £24 million a year by taxing higher earners in Jersey
- Party plans to lodge changes to the Budget or medium Term Financial Plan
- Under plans, every pound earned over £100,000 would be taxed at 25%
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ISLANDERS earning over £100,000 a year should be forced to pay more tax to help plug Jersey’s predicted £145 million deficit, according to a States backbencher.
Reform Jersey chairman Deputy Sam Mézec says his party believes that Jersey’s 20 per cent tax ceiling should be broken and has calculated that a five per cent increase in taxes for the Island’s top earners would bring in more than £23 million a year for the economy.
Under the plans, every pound earned over a £100,000 threshold would be subject to 25 per cent tax. The Deputy said he plans to lodge an amendment to the Medium Term Financial Plan, or the Budget, to formalise the idea following the States’ summer recess.
Deputy Mézec labelled austerity measures outlined by the Council of Ministers as ‘extreme’, saying it ‘does not make economic sense’ to be hitting the pockets of average earners. Among the proposed cost-cutting and money-making measures set out in the MTFP are a new health charge, taxes on disposable waste and up to £90 million of cuts from public services.
Deputy Mézec says that the ministers’ plan is to make everyone foot the bill for the deficit but he believes it should only be those who can afford to pay. ‘If you reduce people’s ability to spend you don’t grow the economy,’ he added.
‘The policies coming from the Council of Ministers are the most extreme set of government proposals and they are extreme to everyone. ‘The health tax, waste tax and £90 million in cuts is the most unproductive way of sorting out the mess and it is against what they said they were going to do. ‘If you create new taxes you create new bureaucracy. We have to raise the taxes we already have.’
According to the latest available figures, which have been released following a Freedom of Information request, around one in 20 Islanders (4,535) earned more than £100,000 a year in 2012, representing a 150 per cent increase since 2003. Of them, 59 were earning more than £1 million per year.
‘I don’t think it would turn them away. There are places in Europe with lower tax rates. If it was all about low taxes they would be in Switzerland or the Isle of Man. They are not there because Jersey is better. We have nice weather, we are one hour from London – Jersey is special enough.
‘I have yet to meet a high earner that has said if we were to raise taxes they’d leave and those who have a social conscience know it’s the right thing to do rather than let pensioners be cold in the winter,’ he said.
According to the States financial report for last year there were 232 civil servants earning more than £100,000 a year when pensions and other benefits are taken into account. In total, 108 individual public-sector salaries matched or exceeded £100,000 a year based on their basic pay.
