Tax rise for top earners to go to tuition fees?

Thursday 16 November 2017

A suggested change to the 2018 Budget could spell the end of the island’s ’20 means 20’ tax regime.

Reform Jersey have put forward an idea that they say will help ‘Middle Jersey,’ and the island’s students, by squeezing more out of Jersey’s higher earners.

They would like to see the 'marginal relief' calculation applied to all islanders, but at a reduced rate of 25% (from 26%) starting in the 2019 tax year.

The party say that two thirds of islanders would see their tax liability reduce under the proposals, while a small proportion would be taken out of Income Tax altogether.

Those currently on a 0% rate would also remain on 0% - only those at the very top end of the spectrum will see their rates rise to 25%.

Video: How Marginal Relief works.

“The aim of this amendment is to make our tax system more simple and fair, whilst raising revenue to provide a reliable income-stream for much-needed investment in public services,” Deputy Sam Mezec, Reform Jersey Chairman, stated in a report accompanying the proposition.

He added: “Reform Jersey believes that this change will give a much-needed break to the ‘squeezed middle’ of Jersey taxpayers, whilst asking those with the broadest shoulders to contribute more. This is a political outlook which has featured in all of our election manifestos, and so this proposition is in line with the mandate given to our members from the voting Public.

“It is our view that the revenue raised should be directed to the Higher Education budget to subsidise the university tuition fees of Jersey students, as an alternative to any proposal which will see students take on potentially tens of thousands of pounds of debt, which will hold back their futures and have further negative economic consequences. This will be followed in a separate standalone proposition, which States Members will have the opportunity to debate, but we hope that this amendment will be considered in this light.”

Pictured: Reform Jersey would like to see the funds redirected into the Higher Education budget in order to pave the way for fully funding Jersey students’ tuition fees.

Deputy Mezec explained that the proposition came about because “the poorest people in Jersey have gotten poorer, while the richest have gotten richer” – a state of affairs that he said the island cannot allow to continue. 

The amendment comes as local parents and students continue to wait for proposals for a long-promised university funding solution to be brought forward by the Council of Ministers. In a recent Scrutiny meeting, Treasury Minister Senator Alan Maclean assured that this would be put forward – but not debated – at the same time at the Budget 2018 debate is to occur in late November.

The Jersey Student Loan Support Group - a collective representing over 1,000 of Jersey's parents and students - have been extremely critical of the delay in bringing forward funding plans.

Well, well, well, something at last but not where we were expecting it to come from!

Very interesting amendment... https://t.co/w8KmXaC6AH

— JsySLSGroup (@JsySLSgroup) November 15, 2017

Writing about Reform Jersey’s amendment on social media, a spokesperson wrote: “Well, well, well, something at last but not where we were expecting it to come from!”