Tony O’Neill, chief executive of SandpiperCI, said the States have failed to properly consider the retail sector and viewed it simply as a ‘cash cow’.
The retail tax was passed during last year’s Budget debate after moves to halve the top rate to ten per cent failed because of a tied vote. St Helier Constable Simon Crowcroft has indicated that he will be bringing forward new proposals to cut the top rate.
Speaking at an Economic Affairs Scrutiny Panel hearing yesterday, Mr O’Neill reiterated his anger that retailers were not properly consulted on the tax. He said: ‘I think the overarching concern is the recent introduction of the 20 per cent retail tax. We are in a very competitive environment in retail.
‘I ask, “How does government view retail?” Is retail an industry to be looked after or is it to be used as a cash cow? I have to say, regrettably, at the moment it seems to be being used as a cash cow.
‘The town centre is coming under more pressure. The peripheral areas of town, like Bath Street, are starting to suffer. Anything not in the main drag of town is starting to suffer.
‘I ask what government is doing about that. My synopsis would be we have not had a retail strategy for years, there has been no joined-up thinking and policy making has been done on the hoof.
‘Retail closures are continuing and what do government do? They introduce a 20 per cent retail tax on the very day that Mothercare and Thomas Cook announce they are leaving the Island for good.’
The retail tax is levied on businesses which have annual profits of more than £500,000 on a sliding scale.
Mr O’Neill added: ‘There is no justification for singling out one particular sector and overly penalising it. We don’t want any favours, but equally we don’t also need government pushing us in the back.
‘If States finances dictate that a tax needs to be levied then it should be at ten per cent. How can you take one sector and say, “You’re it, you’re in for 20 per cent”.’
He also questioned why the Channel Islands competition watchdog had not reviewed freight and shipping costs as there was a ‘monopoly’ in that market and said that he was ‘disappointed’ that ministers opted not to bring forward proposals to drop the £240 de minimis level on internet sales.
Mr O’Neill criticised the States for failing to deliver a retail strategy and said the industry was ‘sleepwalking’ into further shop closures. Economic Development Minister Lyndon Farnham has previously said he was working on a new retail strategy, which is expected to be published early in the new year.
Deputies Kirsten Morel, David Johnson, Scott Wickenden and Senator Kristina Moore were sitting on the panel.
