This report includes details of expenditure proposals for 2012 and 2013 and tax proposals for 2011. Together these proposals, if agreed by the States in December, are expected to bring the States' finances back into balance by 2013.
Expenditure proposals for 2012 and 2013
The Council of Ministers proposed savings of £12 million for 2011 which were agreed by the States as Part 1 of the Comprehensive Spending Review (CSR). The Council is now proposing total spending limits for 2012 and 2013 which increase the level of savings to a minimum of £65 million by 2013.
Tax proposals for 2011 to 2013
The Treasury Minister is proposing £22 million of tax raising measures in 2011, increasing to £55 million by 2013.
The main proposals resulting from the Fiscal Strategy Review are:
a 2% increase in GST from 1 June 2011 raising around £30 million per year (complemented by an increase in income support, and GST bonus)
an increase in the level of contribution from International Services Entities fees by £3 million; and
a 2% increase in the social security contribution from employees and employers, above the existing ceiling (£44,232 in 2011) from 2012, raising around £16 million
Other budget measures proposed include an above RPI increase in impôts duties and a change in the structure of stamp duty rates for properties over £1 million.
In addition, Income tax exemption thresholds will be increased in line with average earnings helping those on lower incomes that pay income tax.