Supermarket giants send scrapping food GST to top of political agenda

Thursday 31 May 2018

Two titans of local retail have thrown their support behind scrapping GST on food items, sending the issue to the top of the political agenda ahead of a fresh crop of politicians being sworn in tomorrow.

Tesco product-seller Alliance and Sandpiper CI, which is today opening the first in a chain of Morrisons Daily stores, said they would be in favour of a debate on whether GST should apply to food.

Their calls followed manifesto pledges from numerous election candidates, who said they would work to get the tax dropped. Those included Reform Jersey, who secured five seats in the States Chamber, and Deputies-elect Philip Ahier and Hugh Raymond – all of whom will be officially sworn in as States Members at 09:30 tomorrow. 

Alliance Managing Director Andrew Bagot first raised the issue earlier this week after announcing that the retailer will be matching the UK Tesco prices of hundreds of everyday items, including bananas, bread, eggs, orange juice and yoghurts. However, Mr Bagot said the store will still have to add GST to the UK prices. 

"Whether GST should be on food is another debate I would like to see happen," he said. "Our new pricing strategy has been in response to customer feedback, so I urge Islanders to continue to share their thoughts and suggestions with us by talking to our staff or perhaps engaging with us on social media. We know there is more to do, and we are working hard to drop more prices in the future.”

He explained that the new pricing followed a consultation with the supermarket's customers who said they’d like to see everyday items become more affordable. 

“Fortunately, we have a strong relationship with Tesco who have been very supportive of our plan to match their UK prices and take advantage of the fantastic quality of product they supply," said Mr Bagot. 

“This is not the launch of any price war but hopefully we can start a debate around food- pricing in the Channel Islands. We firmly believe that great prices on great quality produce shouldn’t be out of the reach of any Islander. We are also working hard on recruiting more great people, as price is just one aspect of retailing - great service is another."

Now today, as the retailer opens the first of 16 new Morrisons Daily stores in St. Ouen’s Village, Sandpiper CI CEO Tony O’Neill has also added his voice to the GST debate.

"At the time that GST was introduced, Sandpiper campaigned strongly against the inclusion of Food. Whilst we recognise that from an administrative perspective, it is much easier to have one level of GST on all products rather than creating exemptions, we do feel that it is iniquitous to tax food products and would support its removal,” Tony O’Neill commented.

Sandpiper announced earlier this year that it had reached a new franchise and wholesale supply agreement with Morrisons, which is currently the fourth largest supermarket chain in the UK. Speaking about the new partnership, which will create around 100 new job roles, Mr O’Neill added: “This is a significant step-change for our food retail operation. Morrisons substantial buying power means we will be able to lower our current Foodhall prices by at least 5% on an average shopping basket and significantly more on many of Morrisons own label products. The opening of the first store in St. Ouen marks the start of a major seven figure investment programme. We will be working with local contractors to convert around one store every week which will include full Morrisons’ branding from store fascias to our colleagues’ uniforms."

Once the Morrisons Jersey store conversions are complete, a similar conversion programme will commence in Guernsey.