That review might yet be conducted – albeit in the emasculated form of advice from the Fiscal Policy Panel – but there was disturbing evidence in the States yesterday that Senator Ozouf has already made up his mind on the issue. Indeed, he made it clear that he believes that it is unlikely that the phasing out of tax allowances will be suspended, irrespective of economic conditions.
The Senator’s view that such a measure would be neither ‘timely’ nor ‘targeted’ could have some merit, but there are a great many taxpayers who would take issue with another of his statements – that any change to the 20 means 20 policy would make little difference to people who are struggling financially.
It is no doubt true that the very well off will scarcely notice the impact of the lost allowances, but the same will most definitely not be true of that much put-upon sector of the population, Middle Jersey. Those who find themselves falling just inside the meshes of the 20 means 20 net will most certainly feel the pinch, especially in the present economic circumstances.
It also remains true that, especially in respect of the loss of mortgage interest tax relief, 20 means 20 has some of the characteristics of retrospective legislation. Any review should surely take into account the fact that many Islanders have based their home-buying and mortgage strategies on the expectation of tax relief being available throughout the course of their repayments. This still smacks of unfairness, a cavalier attitude to difficulties which many people are now having to confront and a continuing determination to target the hardworking majority of Islanders who are neither rich nor truly poor.
Meanwhile, in spite of Senator Ozouf’s contrary opinion, it is easy to see the sense in remarks made yesterday in the States by another Member, Deputy Geoff Southern. It is indeed true that one of the best and simplest ways of making sure that there is more money in the economy is not to take it out in tax in the first place.
