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Treasury: "Not A Question Of PYB Taxpayers Paying Covid Debt"

The Treasury Department has rejected claims that Prior Year Basis taxpayers' 2019 bills will be used to recover the coronavirus debt.

Scrutiny chair Senator Kristina Moore told Channel 103 it raises the question of whether it's fair for just PYB taxpayers to be saddled with paying back the money spent during the crisis, especially as they didn't get to decide what the money was spent on.

The Government Plan states that, if agreed, these payments will be ring-fenced 'so this debt does not become a long-term issue for future generations.'

Assistant Treasury Minister Senator Ian Gorst said that's a sensible approach

"It makes sense rather than just putting that into general revenues and when Ministers knocking on your door asking for more money year on year, we say no you can't have that, because we've already spent this money.

"Therefore we need a ringfenced approach to try and make sure that down the line, whatever repayment terms are settled on, we've got that money ready."

Deputy Susie Pinel has also been asked during a Scrutiny hearing whether it's 'fair and equitable for prior-year taxpayers to be asked to disproportionately pay the Covid debt'.

She said it's not asking people to do that 'whatsoever'.

"It's two-thirds of taxpayers who are on a Prior-Year Basis, but everybody will be generally paying off the Covid debt, because it's an island debt.

"Everybody will be paying it, it's just that we suggested that we might ringfence that money to pay that."

The newly-released revised Government Plan has revealed  the intention to borrow a third of a billion pounds to deal with the impact of Covid-19.

The Assistant Treasury Minister has also urged islanders not to be worried about how to pay back their 2019 bill if they're moved to current-year basis.

A third of islanders who took part in a survey on the plans, to be debated in the States next month, said they'd been financially impacted by the coronavirus crisis.

There are concerns about how the move could financially hurt islanders, particularly on a lower income. The Treasury Department has put out different options for repayment and has said it could be done over a five or ten-year period.

Senator Ian Gorst said the Treasury is very aware that many people are concerned about how this change will directly affect them;

"We recognise that we need flexibility in that framework to be able to deal with the issues of families who've got university cost, or the person coming up to retirement who can draw on their pension.

"That's why we're taking this extra time to be able to rightly consider those and find a way through."

The Corporate Services Scrutiny Panel is currently investigating the controversial plans, with a findings report due to be published before the end of this month. A debate on the reforms is set for the start of November.

Politicians are also due to engage in an in-committee debate on the subject this week. That means States members can speak as often as they like but there is no vote at the end.

A petition asking for the 2019 bills to be scrapped was signed more than 5,600 times. Deputy Pinel said the government isn't in a position to do that because it would cost £320million. She also said it would be unfair to Current-Year Basis taxpayers.

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