Former States Economist Denounces Proposed Income Tax Increase

A former States economist has sharply criticized proposals to raise income tax, labeling them “lazy, crude and cruel.” Dr. Andy Sloan, in a letter addressed to all deputies and reviewed by the BBC, stated that the plan by Policy and Resources (P&R) to implement a temporary 2p in the pound income tax increase lacks fiscal competitiveness and fairness. Dr. Sloan asserted that this increment would result in island residents contributing 10% more in taxes compared to individuals in the UK earning an equivalent salary. Conversely, P&R has articulated a “need for action now,” arguing that the increase “forces the next States to decide on a long-term fiscal solution to our financial challenges, including the cost of long-term care.” These proposals, which involve raising income tax for a duration of two years concurrently with exploring the introduction of GST, are scheduled for a vote when the complete 2025 budget is presented to deputies. Dr. Sloan elaborated, stating, “Raising the personal income tax by 2p in the pound, will mean a Guernsey worker on an average wage will pay 10% more tax and social insurance contributions than a worker on the same pay in the UK.” He also noted, “When I came to the island in 2008, a Guernsey worker on the average wage paid 20% less.” He further characterized the approach, saying, “Increasing income tax like this is a lazy, crude and cruel tool.” Dr. Sloan concluded that “These proposals display no sympathy or empathy with average workers.”