ISLANDERS have reacted with shock and confusion to the upcoming changes to GST, with some calling it a ‘disappointment’, a ‘joke’ and ‘disgusting’.
The government has confirmed that from the beginning of next month, large online retailers – those whose turnover exceeds £300,000 annually – will be subject to the same 5% sales tax as the Island’s high-street retailers.
This means that GST will have to be paid on any item bought from companies such as Amazon, regardless of the value of the product.
Meanwhile, the ‘de minimis’ threshold at which Islanders pay GST on imported products is due to be slashed from £135 to £60 when buying from smaller online retailers.
The government has said that it has advertised the changes, but many Islanders have said that they were unaware that GST will be payable for all goods bought from the big retailers regardless of the value of the product.
Dominic Egré, who volunteers at the St Vincent de Paul foodbank, said the changes will heap more financial strain on the poorest Islanders.
‘It will have a knock-on effect on those low-income people who were having to go to bulk sale and online retailers in order to save money.
‘The 5% on that worries me. It’s items like cleaning and hygiene products, and long-life food.
‘We’d all love to buy local, but the people we help just can’t afford to do it.’
Mr Egré added that very few of the foodbank’s clients would know about the change.
‘This will be a shock for them,’ he said, and added: ‘Our original advice to shop online might not be as useful now.’
‘It is yet another thing for these individuals. Saving 5% might not sound a lot, but when the cost online is slightly cheaper, it does help people stay just above the poverty line.’
Deputy Rob Ward, from Reform Jersey, said there was a ‘lack of clarity’ on the change.
He added: ‘I think we need to look very carefully at this. I agree with encouraging people to buy on the Island, but we can’t stock everything and we can’t stop people accessing those businesses if they need them.’
He continued: ‘I wonder if the minister saw the implications of this at the time, and if the Assembly saw the implications of this at the time. That’s a question that needs to be asked of the minister.
‘It’s another measure of raising tax by the back door, and GST is a regressive tax that disproportionately affects those on the lowest income.’
Deputy Max Andrews said that ‘the communication side could have been better, that’s for sure’, adding: ‘People have been perplexed by this.’
Treasury Minister Ian Gorst defended the change this week.
He said it was ‘fundamentally an issue of fairness’, adding that ‘it cannot be right, for example, that a £25 item bought in our high street is taxed, while the same item from a large offshore retailer is supplied tax-free’.
What people said
Ollie Taylor: ‘I certainly wasn’t aware that we would now be charged GST on any item bought on Amazon from July.’
Dannie Twyman: ‘How about Government of Jersey address the fact we pay GST on food and other items to just live (unlike the UK, who remove tax on certain things like food) before adding GST onto everything else. We are already subject to compounding taxes and import costs. It’s already unaffordable to live here. It’s no wonder people are leaving!’
Tanya D’Ulivo-Rogers: ‘Why when so many Islanders are struggling already with huge cost-of-living increases across the board and mortgage rate rises? A further disappointment from our government with poor decision-making that will have a negative impact on the local residents. I thought you wanted to increase the population, not reduce it.’
Siovhan Foott: ‘Absolute joke! We can’t wait to leave Jersey. Lots of us Beans leaving or have left already. Sad times.’
Steve de la Haye: ‘Not one to normally post on here, but why are we not increasing the tax paid by the super-rich who can afford minor incremental increases (but would generate substantial tax revenue for the Island relative to their overall earnings) before adding additional financial pressures on lower-income families who are already struggling with the cost-of-living crisis we’re currently facing?’
David Sutcliffe: ‘Ridiculous! I always try to shop locally wherever possible, but 99% of what I order from Amazon I cannot get locally, so it is not to the detriment of any local retailers. This is just another stealth tax, imposed without any warning to boost States coffers, so they can waste it on something else.’
Toni Bohan: ‘Absolutely disgusted with this government! I buy from Amazon because I can’t find what I want locally, so if the idea is to force me to only shop here it isn’t going to work, because I really have no choice.’
