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Jersey’s goods and services tax (GST)
In 2008 Jersey will have a new tax on goods and services. The first step has been to draft the legislation which will establish the framework in which the tax will operate. In a few months the government will publish a second document which will be widely available concluding the proposals for the implementation of GST with a proposed flat rate of 3%.
The tax will be designed to suit Jersey’s needs. The objective is to achieve a tax that will raise £45 million in annual revenue but will be simple for all concerned, while maintaining Jersey’s economic competitiveness and having the minimum possible effect on the cost of living and business activities.
GST will be a tax on consumption of goods and/or services in the Island, paid as a percentage of their value at the point of sale. It will be chargeable at every stage leading up to the final consumer and will be collected by GST registered businesses when they supply their customers with goods and/or services that will be designated taxable by law.
GST registered businesses will account for GST in their sales records and pay the tax collected from their customers to the taxation authority. However, they will be able to reclaim or offset the GST they have paid on their business costs. This means that the tax is borne by the customer.