Budget Targets Property Taxes As Revenue Raiser

P&R hopes to raise £2.2 million by increasing property taxes and duty on alcohol, tobacco and fuel.

TRP, or Tax on Real Property, will increase by an average of 17% for large homes, with less steep increases on smaller properties.

Owners of empty properties and derelict glasshouses will be hit with a tariff five times higher than the standard rate.

P&R's Treasury lead, deputy Mark Helyar, says that will not only raise revenue, but encourage properties back on the market.

"Members of the public will be aware from driving around the island there’s lots and lots of derelict property that’s not being developed. There are also lots of sites that have got planning permission where the building has not been pursued. We'd like to encourage members of the public who have those sort of sites to get on and help that contribute to the economy."

Alcohol duty is to rise by 5.9%, putting an average of three pence on a pint of beer and 14p on a bottle of wine. The costs of a packet of cigarettes will also jump by around 62p.

"HSC agreed some amendments in previous years, where we have to increase, particularly alcohol and tobacco duties, by at least inflation."

Duty on motor fuel will rise by 3.9%.

Income tax allowances will increase by 7% to £13,900.

The budget comes just a week before the States are due to debate P&R's Funding and Investment' Plan, with the committee pushing for the introduction of GST for a second time this year.

Independent economists say that this levy alone will not be enough to get the government's finances back on a sound footing.

Deputy Helyar says that, if 'scenario three' passes, cuts to public services will continue.

"The likelihood is that we simply won’t be able to meet the level of cuts necessary in order to balance the budget in the future. We’re going to have another 5000 pensioners in 20 years' time. The majority of the pressure is on health and pensions, and we have to square the circle somehow, but that will inevitably lead to a significant cut in public services."

Health, as the biggest spending committee, had asked for an above inflationary spending top up of £10.4M on top of the £5M increase already allocated to it. P&R says it can't afford this level of funding and is suggesting HSC gets an extra £4M.

The draft budget will be debated in November.