Deputy Susie Pinel said her department was looking at reducing the amount upon which individuals would be taxed on imported goods from £240 following ‘furious’ complaints from retailers about the damage internet shopping is causing the high street.
The plans are due to be included in this year’s Budget.
However, the Jersey Consumer Council has described the measure as a ‘sticking plaster’ which will have little effect on Islanders’ shopping behaviour and has called for a more joined-up approach in creating a ‘vibrant’ high street.
The announcement comes after three members of the Jersey Retail Association warned last month that the industry was currently facing near-record-breaking shop vacancy levels with many shops facing sustained difficult trading standards.
During a question without notice about the de minimis level [the minimum amount of GST collected on imported goods by individuals] in the States, Deputy Pinel said: ‘From the retailers’ point of view they feel this is too high. We are looking at it at the moment with a view of reducing it. That will be in the Budget.’
The minister would not be drawn on the value she was considering reducing the threshold to.
She was asked by Deputy Mike Higgins whether she recognised that lowering the de minimis rule would ‘damage a lot of poorer families who find it cheaper to buy outside the Island’.
‘We totally appreciate that, but we’ve got to be able to listen to the retailers here who are complaining furiously about the lack of business on the high street,’ Deputy Pinel answered.
‘We understand, of course, that people who shop online will then have to pay GST but we are not abolishing the de minimis just looking at reducing it, which will certainly help with retailers.
‘As far as the EU goes they would possibly want us to abolish it completely. We are not going that far but we may have to, depending on Brexit.’
Senator Sarah Ferguson asked if the minister would consider negotiating with Amazon to charge five per cent as part of the original payment and for the States to collect it from the online retailer.
Deputy Pinel said this was something her department was considering and had looked at other jurisdictions which had asked Amazon to pick up the cost of GST or VAT.
‘In Australia that is exactly what happened, they [Amazon] were asked to pick up the cost of the introduction of goods into Australia and reduced their goods and services considerably as to what they would transport [there]. We have to be very aware of that and the reduction of services that may apply to us.’
Ann King, executive officer of the Jersey Consumer Council, said reducing the de minimus level would not only increase consumers’ shopping bills but that there would also be administrative costs to the States for holding taxable items.
She added: ‘I think it is a sticking plaster to fix the current dilemma retailers are facing. I don’t think it will change shopping habits.’
Mrs King said that for positive changes to be made to the high street all interested parties needed to work together.
‘The problem is we are not using our local high street,’ she said. ‘How is that fixable? Should we look at the high street with a different brief? I’m not saying turn it to offices but is there a different way for us to shop and behave?
‘One of our concerns is that we have got a Scrutiny panel review, a Retail Association panel, a retail tax looming over us and a retail strategy – why are we not doing all that together?’
