"Extra 3% on top earners' income tax would prevent benefit cuts"

Thursday 17 September 2015

An extra 3% in tax for Islanders earning over £100,000 would stop the States freezing benefits, as well as keeping Christmas Bonuses and free TV licences.

Deputy Geoff Southern is putting the alternative proposals forward to the States big financial debate next month – he says that an extra tax on top earners is a fairer way to help plug the deficit than cutting into benefits, particularly on the elderly.

The Reform Jersey member says that raising the tax rate from 20% to 25% for the 3,129 taxpayers earning over £100,000 would raise an additional £17 million per year, and that a raise from 20% to 23% would raise an extra £10 million.

And the 3% raise would cover the cost of having to make the cuts in benefit spending that ministers are proposing in the Medium Term Financial Plan – which sets out a plan to tackle the £145 million deficit expected by 2019.

In the report accompanying his proposal, Deputy Southern says that it’s time that the rich were asked to pay their fair share.

He said: The Council of Ministers fails to recognise that lower- and middle-earners have been subject to large-scale rises in taxation year after year for the past decade.

“The time has come to implement progressive changes to our tax structure. That is, the highest earners should be asked to contribute a little more to the increasing costs of caring for and protecting the elderly and the most vulnerable in our society.”

The Medium Term Financial Plan will be debated on 6 October.