18 July 2014
The Budget 2015 proposals – the last during this Ministerial term of office – have been lodged with the States Assembly.
The proposals contained in the Budget 2015 are designed to continue to deliver capital spending to support the early stages of economic recovery while ensuring that prudent measures were taken to provide stability within the budget.
“This year the budget is designed to maintain balance between the need for continued support for the economy, protecting jobs, helping local business and sustaining a lower marginal tax rate” said Treasury and Resources Minister Senator Philip Ozouf.
The key considerations for the Budget 2015 are to:
- maintain a stable tax system and sustain a lower marginal rate of taxation
- enable recovery and protect our strong financial position
- support the housing market which is showing signs of recovery
- continue to put more money into the economy than is taken out of it by protecting capital spending and making no significant tax changes
- support long term savers by providing greater flexibility on the tax treatment of pensions.
The budget presented for 2015 also contains a number of proposals which address the potential for lower personal income tax revenue in coming years.
Treasury and Resources Minister Senator Philip Ozouf said “The measures that we are proposing for 2015 are not dramatic. They have been designed to promote stability, encourage further economic recovery and protect our strong financial position.
“We have taken account of the latest forecasts and taken prudent measures to ensure that we can balance the books,” he said.
Budget 2015 proposals
The main proposals are:
- maintaining the Marginal Rate at 26% for 2015
- increasing all tax exemption thresholds by 1.7%
- reducing the stamp duty on the cost of borrowing on lower value properties (Nil for the first £300,000 then 0.25% on the balance up to a maximum property cost of £400,000)
- increasing the stamp duty payable on purchasing residential property costing £1m or more on a rising scale
- cap mortgage interest tax relief at £15,000.
In addition to these measures, the Budget report also contains proposals which aim to modernise and simplify the tax system, making it equitable for all tax payers.
Among those proposals are changes to the tax rules applying to pensions. These follow a comprehensive consultation and will provide greater flexibility for pension savers and give Islanders greater confidence in their future pension provision.
A wide-ranging public consultation on property tax has also been launched alongside this budget. The consultation will be open until the end of the year and will gather Islanders’ opinions on how a property tax system should work in Jersey.
In the 2014 Budget statement, Treasury and Resources committed to the publication of a long term tax policy. This work will outline the future development of Jersey’s tax system and will be presented in advance of the Budget 2015 debate.
This year the Budget debate will move from its usual timing in December to take place in September ahead of the Island’s general election in October.
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