Taxes that hit the poor

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From William Emslie.

I’M a Jerseyman currently enjoying a tour of the UK, working as a street entertainer and jobbing musician.

It’s a precarious existence financially (though not one I would care to swap for the security of a regular job at present), and so the issues facing those living on low incomes are high on my agenda at the moment.

Catching up with the local news on the This Is Jersey website, I was astounded by Philip Ozouf’s proposals for the 2010 Jersey Budget.

Firstly, he intends freezing yet again the income tax threshold. By my calculations, this means that anyone working full-time (40 hours a week) on the minimum wage will now have to pay tax.

Has Senator Ozouf any idea what a struggle it is to survive in Jersey on under £250 a week? Has it not crossed his mind that instead of drawing more low-earners into the income tax system, those who can afford it could be asked to pay a little more?

Then there are his proposals for more regressive taxation: increases of up to ten per cent on the duty on alcohol, tobacco and fuel. The fuel, I note, is that which the poor use in their cars to get to work and earn their six quid an hour, not the stuff the rich put in their cabin cruisers for a day out in France, but that’s another story.

I accept that alcohol and tobacco are luxury items and that those in the income bracket I’m talking about can rarely afford more than the odd tinnie of 8.6 in the Parade in any case. What worries me is that in talking about ‘increasing duty to UK levels’ Senator Ozouf seems completely out of touch with the current cost of living in Jersey.

So, in case he hasn’t noticed, I’ll spell it out for him: the days when Jersey was a cheap place for fags and booze are over.

To illustrate, last night in York (by no means the cheapest city in the UK) I visited a pub and enjoyed several pints of excellent cask-conditioned bitter at £1.69 each. In Jersey, were the product available, it would cost at least £2.60. Here, a pint of premium lager is around £2.50 a pint. In Jersey it’s £3.20.

The price of spirits in pubs and off-licences in the UK is between 10 and 50 per cent lower than in Jersey. Give or take 10p, the price of tobacco is pretty much the same on both sides of the Ecréhous.

For me, though, the real issue is that for those on middle to high incomes, inflation-busting increases on duty are merely an annoyance.

Those who feel the pinch are, once more, those on low incomes, struggling to make ends meet. The ones who will again be subject to additional tax burdens, paying the transitional 27 per cent rate on their meagre taxable wages, while those on high incomes continue to pay their 20 per cent flat rate.

Of course, this is nothing we should not expect from one of Senator Ozouf’s political persuasion. What I will be watching is the commitment of those States Members who claim to represent the common people to challenging this policy of taxing the poor and going easy on the rich.

I and my vote will be back in Jersey before the next election.

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