Several deputies have cast serious doubts on the numbers and assumptions behind GST, in a series of leaked emails seen by Express.
Deputies Mark Helyar, Neil Inder, Rob Curgenven and David Goy have raised a series of questions and criticisms of the latest tax proposals from Policy and Resources.
Deputy Goy said: “Some of the figures provided by P&R are, in my view, wildly optimistic and do not reflect real-world conditions.”
He criticised P&R’s projection that GST would only increase inflation by 1.9%, arguing that the estimate didn’t account for firms passing on implementation costs to customers – an issue Express has previously highlighted.
Meanwhile, Deputy Helyar questioned P&R’s explanation over why health spending had increased and the decision to move forward with tax reforms without a States Treasurer in place.
However, P&R has hit back strongly at these claims, branding them as “misunderstandings” and “odd suggestions.”
P&R President Deputy Lindsay de Sausmarez insisted that the figures were backed by rigorous, tested economic modelling rather than guesswork, and warned that delaying a tax overhaul could completely exhaust Guernsey’s financial reserves by 2031.
The committee also dismissed concerns over an impending rent crisis or public sector pay bidding wars, claiming that critics are misinterpreting administrative budget changes as organic spending spikes.
The backlash comes on top of mounting criticism from deputies of the States’ spending and taxation plans, with Deputy Haley Camp resigning from Economic Development in protest against what she sees as “autocratic” leadership and reckless spending.
Health numbers don’t support P&R ‘gospel’
Meanwhile, Deputy Helyar questioned the explanation given by P&R and the civil service for the 58% jump in health spending over the last five years.
Deputy de Sausmarez previously told Express that health spending was going up £5m a year “because demand is growing – because we’re getting older”.
However, Deputy Helyar said: “We are told repeatedly by officers that demographics are to blame and it is accepted as gospel but the numbers do not support this.
“There is no connection whatsoever between demographics and the major increase in health spending.”
Echoing concerns from other deputies about how easy it was to find information in the States accounts, Deputy Helyar said the numbers were “impossible to find unless you analyse every set of accounts individually”.
Deputy Helyar said the States should try to understand why health spending had increased by £60m and not come back down since Covid, before raising taxes to “fill the hole in”.
“Without that additional spend we would be in a relatively healthy cash position,” he added.
Deputy George Oswald, President of Health and Social Care, replied that the £60m spike was actually an illusion created by internal paper-shuffling.
Deputy Oswald admitted the large post-Covid jump was mainly caused by moving millions of pounds to HSC’s budget from Employment & Social Security.
In her response to Express, Deputy de Sausmarez maintained there was a real issue driven by Guernsey’s aging demographics, leading to a steady, predictable £5m annual increase in health spending.
She said there had been “lot of confusion underpinning this question”, but insisted Deputy Helyar “mistook this administrative change for a big spike in spending, but that is not a claim that P&R had ever made”.
Flying blind without a CFO
Deputy Helyar, who is President of the States’ Trading Supervisory Board, also questioned why the States was going ahead with tax reforms without a permanent States’ Treasurer – or Chief Financial Officer – in place.
He said: “No serious organisation would undertake such a serious revision of tax or finances without a CFO.”
In response, Deputy de Sausmarez said: “What an odd suggestion! Policy is driven by politicians, not civil servants.”
She said the proposals were shaped by a robust internal network – including the Director of Tax Policy, the Fiscal & Economic Analyst, and the Head of Treasury.
Deputy de Sausmarez said that both the past and acting States’ Treasurers have consistently given the same advice: Guernsey must “act now to” broaden its tax base.
Budget ballooned after Brexit
Deputy Helyar asked for a “detailed analysis of where and why the costs are rising”.
“Last term the costs of importing employees and paying agency [staff] was also raised but there has never been any detailed numbers,” he added.
In response, Deputy Inder, President of the Development and Planning Authority, said he had “a distant memory of P&R’s budget ballooning due to Brexit work”.
However, he had “no idea if that budget was ever reduced post-Brexit”.
‘Finger in the air’ maths
The lack of transparency and clarity over the numbers has fuelled a growing backbench rebellion over how P&R calculated its headline £55 million GST revenue target.
Deputy Rob Curgenven, a qualified accountant, revealed a staggering encounter with a senior civil servant when pushing for the data behind the magic number.
“When I asked a well-respected civil servant how P&R had arrived at the estimated £55m of GST revenue, the response was a smile, a finger held up in the air, and no explanation,” Deputy Curgenven wrote.
“As an accountant, I could not present my employer with a projected £55m revenue figure without also providing the workings that produced it,” he added.
But P&R Vice President Yvonne Burford fired back at his allegations, claiming in an email that civil servants were hard at work behind the scenes to “dispel [your] erroneous assumptions”.
“Please bear in mind that the officers dealing with this have immensely busy day jobs to do as well.”
Deputy de Sausmarez said the “raw data” couldn’t be shared, as it contained people’s private census data.
However, she disputed the claim that the modelling had holes in it, saying it was derived from a complex, “bottom-up” model utilising detailed household income data from the rolling electronic census and local expenditure maps.
Landlord loophole
The leaked emails also expose a possible loophole which could drive up rents for people in private accommodation.
Because landlords are barred from reclaiming GST on building repairs and maintenance, Deputy Curgenven warned these massive hidden expenses would be passed on to tenants, through higher rents.
He criticised P&R for not factoring this effect into their projections, saying it “does not appear to be included anywhere else in the policy letter”.
Other critics have also pointed out that private rent increases are often tied to inflation through measures like the Retail Prices Index excluding mortgages (RPIX) – which tracks the cost of a typical “shopping basket” of common products.
So even a small inflationary effect from GST will further push up Guernsey rents – which are already some of the most expensive in the world.
Deputy de Sausmarez said Deputy Curgenven had “misunderstood” the proposed tax structure.
She said leases on domestic residential dwellings would be zero-rated, meaning landlords will be legally permitted to reclaim GST incurred on repairs and maintenance.
As a result, fears of multi-million-pound hidden costs being passed on to tenants were “quite simply unfounded”, she added.
Public sector pay rises?
Deputy Curgenven questioned whether GST would further push up public sector salaries, with the States’ payroll standing at an eye-watering £415.4m in 2025.
Deputy de Sausmarez downplayed the idea that the States would have to pay out massive cost-of-living raises to its 5,000-strong workforce to match the 1.9% GST inflation spike.
The P&R President said there was “no more a guarantee of an inflationary uplift in public sector pay than there is in private sector pay”.
However, Deputy Curgenven questioned the plausibility of her claim, given the influence of local trade unions and a series of above-inflation pay awards over recent years – something that’s much rarer in the private sector.
Between 2021 and 2025 many public sector workers and civil servants got a series of pay rises which added up to nearly 25% in total.
“Practice over many years has been to make pay awards which track inflation over any extended time period,” Deputy Curgenven said, noting that unions regularly drag the States to tribunals if they are unhappy.
He asked Deputy de Sausmarez if it was “P&R’s intention that a real-terms pay cut should be imposed on public sector workers if the proposed tax package is adopted?”
Responding to Express, Deputy de Sausmarez acknowledged that public sector pay negotiations traditionally use inflation (RPIX) as a benchmark, but said the States was “not obliged to offer pay increases matched in full to inflation”.
Crucially, many public sector workers would be “more than compensated” for the 1.9% GST spike by the income tax and social security relief measures built into the wider tax package – a factor she expected to bring to the negotiating table.
Unsatisfactory answers
Deputy Curgenven, who has publicly questioned P&R’s workings, called on the committee to publish their raw economic spreadsheets “as is”, so that deputies and the public can see the truth before July’s critical debate.
He said: “Members are effectively being asked to vote on the basis of figures whose underlying assumptions, modelling and calculations have not been made available for scrutiny.
“Given the significance of the decisions before us, I do not believe that is a satisfactory basis upon which to legislate.”
Hard to follow
There may be a rebellion brewing among back bench deputies, but the message coming out of P&R is a unified one of support for the latest tax proposals – which we’re told will make the majority of ordinary people better off.
The civil service even spent thousands of pounds of taxpayers’ money last year creating a calculator to show the public just how much better off we’d have been under the – now abandoned – 5% GST+ proposals.
The calculator has now been updated for the new proposals.
However, it’s not just Deputy Helyar and Deputy Andy Sloan who are struggling to follow the States’ numbers.
When it comes to figuring out how the numbers for the biggest tax change in generations were actually put together, it seems the island’s politicians are having just as hard a time following P&R’s reasoning as many other people.
