IMMINENT GST changes will aim to ‘ensure fairness between local and offshore retailers’, the Comptroller of Revenue has said after Islanders questioned the reasoning behind the decision.
Richard Summersgill also said in a Q&A blog posted to the government website yesterday that the new regulations would ‘eliminate the administrative concession on lower-value items’.
From 1 July, the ‘de minimis’ threshold at which Islanders pay GST on imported products will drop from £135 to £60.
But larger retailers (those with an annual turnover of at least £300,000) will be subject to the same rules as the Island’s high-street retailers, meaning online orders of any value from companies such as Amazon will be subjected to the 5% sales tax.
Hundreds of Islanders took to social media last week to express their concern, shock and confusion over the changes, with many unaware about the new rules for large online retailers.
In the new blog post – which still does not clarify that any purchase from large retailers will see 5% added at checkout – Mr Summersgill said: ‘The reduction in the de minimis level is in line with actions taken by the UK and the EU. It aims to ensure fairness between local and offshore retailers and to eliminate the administrative concession on lower-value items.’
In response to concerns that retailers could charge GST on top of the UK’s VAT, he moved to reassure Islanders that ‘guidance notes’ had been provided to overseas retailers which ‘clearly states that sales to people in Jersey should not be subject to VAT or its equivalent’.
He added: ‘Retailers will need to update their systems to recognise Jersey and apply only GST at the point of sale. Customers should check with retailers that VAT has been removed at the point of sale.’
Mr Summersgill was further questioned on whether the changes would mean a slower delivery of goods.
He responded: ‘Jersey Customs and Immigration, along with shippers, couriers, and Jersey Post, have collaborated to ensure that goods sold by GST-registered online retailers and marketplaces are recognised on the system. This will expedite customs clearance for GST purposes and speed up the delivery of goods.’
These GST changes were previously deferred from 1 January 2023 as part of the cost-of-living ‘mini-budget’.
Charity heads and foodbank volunteers spoke to the JEP last week about the difficulties they would cause Islanders who were already struggling and argued it was not the right time to implement them when the cost-of-living crisis was ongoing.
