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Minister: GST De minimis cut on imported goods is ‘right’

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CUTTING the GST threshold on imported goods to £135 ‘strikes the right balance’ between supporting consumers and local retailers, the Treasury Minister has said, as she rejected calls for the current level of £240 to remain in place.

Treasury Minister Susie Pinel (28935155)

Plans to reduce the de minimis level were approved by the States Assembly as part of the Government Plan.

However, an online petition calling for the reduction to be scrapped, and the £240 limit to remain, has gathered more than 2,300 signatures, triggering a ministerial response.

The petitioner argued that cutting the threshold would put increased strain on the cost of living, and would impact many families in the wake of the coronavirus pandemic.

The response read: ‘The Treasury and Resources Minister [Deputy Susie Pinel] does not support this petition. She considers the planned reduction strikes the right balance between the competing needs of consumers and those of local retailers.

‘The minister believes that it is absolutely fair that all goods should bear GST regardless of whether they are bought from a local retailer (in a shop or online); or from an offshore retailer.

‘The GST de minimis level is not primarily a tax allowance. It is an administrative easement to ensure that Customs officers do not spend more time collecting GST on imported parcels than the GST itself is worth. Even at the margin, with a de minimis level of £135, the costs of administration are recovered four-fold. There is therefore no justification for maintaining the current level of £240.’

The response adds that there is a long-standing government policy that the de minimis level will be reduced further – ‘possibly to zero’ – when European Union changes to the way tax is collected are made in 2021.

It continued: ‘The government will continue to develop and implement appropriate measures to stimulate Jersey’s economy following the pandemic and to help Islanders suffering financial hardship. Encouraging local spending is an important consideration which has further justified implementation of this measure from 1 October 2020.’

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The de minimis threshold was originally due to have been lowered on 1 July,

but was postponed as a result of the pandemic.

The petition remains live until 24 December and, should it surpass 5,000 signatures, the issue would be considered for a States debate.

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