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The Chamber of Commerce has written to the States Treasurer with concerns over the way the consultation around the recently agreed 20% Retail Tax was handled in the hope the States will reconsider their decision.
The Chamber submitted a Freedom of Information (FOI) request to obtain details on the consultation mentioned by the Treasury Minister, Senator Alan Maclean during the 2018 Budget debate, but says the information received shows that there was no real consultation.
In a letter sent to the Chief Officer of Treasury and Resources Department, Richard Bell, the Chamber says it is "deeply concerned following the decision to implement the Retail Tax at a 20% level taken by the States in November 2017."
Members add that although they "lobbied" States Members about "...the unintended consequences the 20% rate would generate and importantly, the lack of consultation that was carried out with the retail sector," they believe their concerns have been ignored.
In the letter, the Chamber says nine out of the 20 companies mentioned by the Treasury Minister were not contacted a year before the Budget debate. While parties were invited to a presentation on 20 and 21 September, "they were told of the intended implementation of the Retail Tax, its rate and sliding scale."
As a result the Chamber says this does not amount to a consultation and suggest the States look at recent examples, "...such as the recent GDPR legislation changes to see the time and effort that goes in to what Chamber would consider adequate consultation with businesses who are or who are likely to be in the near future, affected by such a fundamental change."
As the result the Chamber says it is unsure "...how our States Members could have made the correct decision on this important change to our tax regime when presented with the information made available to them and the unfounded impression that a consultation had taken place with the retail sector when in fact it had not."
While businesses say they agree that "everyone on our island should pay their way," they think that "...to bring in a tax that is higher than the UK rate of corporate tax for a small number of retailers does not feel low, broad or fair as indicated by our Chief Minister as he discussed our budget in the recent past."
As a result, the Chamber says that "if our States Members feel that they have made a decision without the full facts, we would ask that the States look to reconsider this decision." It also says they would be happy to work with Treasury & Resources department to bring representatives "to discuss the impact that this tax will have on their businesses to allow the correct consultation to take place and ultimately an informed debate for our States Members."
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