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Estimate for the loss £320m income tax

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WQ.315/2020

WRITTEN QUESTION TO THE MINISTER FOR TREASURY AND RESOURCES

BY DEPUTY G.P. SOUTHERN OF ST. HELIER

ANSWER TO BE TABLED ON TUESDAY 8th SEPTEMBER 2020

Question

Will the Minister provide members with the detailed calculation that underpins the estimated loss of £320 million in Income Tax that would arise from writing off the tax liability for 2019 of those Islanders transferred from payment on a prior-year basis to one on a current-year basis and will she state in particular over what time period this loss is deemed to occur?

Answer

The estimated 2019 prior-year basis (PYB) aggregate tax bill £320 million was originally based on the amount of income tax paid by PYB taxpayers for 2017 (£316 million) which is derived from data which can be found in the Tax Statistical Digest for Income Tax for year of assessment 2017 relating to income- tax receipts from PYB and data about the distribution of PYB and current-year basis taxpayers. The equivalent figure for the 2018 year of assessment is now estimated to be £326 million; and we currently estimate that the 2019 liability is now likely to be closer to £330m.

If the 2019 PYB tax bill was written off by the States Assembly, the loss would be immediate.