Andrew Bagot, managing director of Alliance, has called on the States to debate the removal of the five per cent tax from food to help bring costs down so that they are comparable with the UK.
And, in a move he hopes will start a wider debate about food pricing in the Channel Islands, Mr Bagot announced that his company, which stocks Tesco products at its four Alliance stores, would be matching Tesco UK prices on hundreds of items permanently. However, he said that GST would still have to be added on top.
‘This is not the launch of any price war but hopefully we can start a debate around food pricing in the Channel Islands,’ he said.
‘We firmly believe that great prices on great quality produce shouldn’t be out of the reach of any Islander.
‘Of course, although we will be matching UK Tesco prices, in Jersey we do have to add GST. Whether GST should be on food is another debate I would like to see happen.’
Consumer Council executive officer Anne King said that she supported the call for a debate about GST on food and added: ‘Provided this move puts in place price reductions for the consumer in the long term, it is naturally a welcomed move.
‘But obviously we don’t want to see any changes impact the price of other products and would expect the change in food prices to be done in good faith.’
In the UK, VAT is added on non-essential items, meaning that basic food, water, children’s clothing and books are tax free.
Mrs King added: ‘We [the Consumer Council] feel a debate on GST should take place.
‘We have learned over the years that consumers in Jersey feel there is a lack of transparency in food pricing in the Island and we would welcome a States debate on the topic.’
GST was first introduced in the Island in 2008 at a rate of three per cent before it was upped two years later to five per cent.
Alliance has four stores in the Island – in Sand Street, Broad Street, Halkett Place and in St Ouen. It plans to price-match on everyday items including bananas, bread, eggs, orange juice and yoghurts.
Mr Bagot added: ‘The reason behind this [decision to match UK prices] is simple. We asked our customers what we could do to improve, and they told us they’d like to see everyday items become more affordable.
‘Fortunately, we have a strong relationship with Tesco, who have been very supportive of our plan to match their UK prices and take advantage of the fantastic quality of product they supply.
‘Our new pricing strategy has been in response to customer feedback, so I urge Islanders to continue to share their thoughts and suggestions with us by talking to our staff or perhaps engaging with us on social media. We know there is more to do, and we are working hard to drop more prices in the future.’