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St Helena : St Helena Legislative Council St Helena Island, 27 May 2011 To the people of St Helena
Submitted by Saint Helena Herald (Public Relations Information Office) 27.05.2011 (Article Archived on 17.06.2011)

Following the public demonstration held on Saturday 16 April 2011, the Council met with the organisers of the demonstration at an Informal meeting of Legislative Council on Friday 6 May 2011.

St Helena Legislative Council St Helena Island, 27 May 2011 To the people of St Helena


 


Following the public demonstration held on Saturday 16 April 2011, the Council met with the organisers of the demonstration at an Informal meeting of Legislative Council on Friday 6 May 2011.


 


During this meeting, the organisers of the demonstration presented members of Legislative Council with two alternative tax proposals. 


 


Council has considered these proposals which are summarised below and believe it is appropriate to offer their response to the wider community.


 


Alternative 1


Return wharfage and customs duties (excluding alcohol and tobacco) back to their original pre-reform levels. 


Maintain Services Tax and Withholding Tax on Bank Interest.


Maintain personal allowance at £7000 pa.


Introduce a new higher rate tax band of 32% on earnings over £14,000 pa


 


Alternative 2


Return customs duties (excluding alcohol and tobacco) back to their original pre-reform levels


Increase wharfage from 5% to 8%.


Remove Services Tax and Withholding Tax on Bank Interest.


Maintain personal allowance at £7000 pa.


Introduce a new higher rate tax band of 32% on earnings over £14,000 pa


 


Council has given full consideration to both the above alternative options and have concluded that neither is conducive to the Islandís vision for sustainable economic growth.


 


The move away from collecting tax directly from St. Helenaís working populationís pay packet and towards paying tax on goods and services will help to broaden the islandís tax base as it allows a large proportion of tax revenue to be collected from visiting tourists, consultants, contractors and other people who would not normally be subject to income tax.  This presents a more sustainable revenue stream for the St Helena Government to invest in essential public services for the island. 


 


A high proportion of the islandís working age citizens have left for more attractive opportunities abroad.  The tax package is a strategically essential component when trying to attract people back to St. Helena.  People that have invested both time and money in developing their skills and gaining valuable experience would naturally be expecting to earn a higher salary.  They will most likely view a 32% tax bracket as a disincentive to remaining on or returning to the island.


 


The low income tax and corporation tax rates provided in the new package will complement St Helenaís Investment Policy by creating a more attractive business environment.   St. Helena will be competing in the global market for investment.  A 32% tax bracket will be a further disincentive to both local investors and foreign investors that may be planning to start a new business or, in the case of existing businesses, expand the quality and range of their products and services.


 


Council fully accepts that some households will be adversely affected in the immediate future and have taken onboard the concerns from various segments of the community.  To this end, they have established a Working Group to examine further the customs tariffs and the feasibility of a child benefit policy in the context of the Social Impact Assessment.


 


Copies of the Social Impact Assessment will be available to members of the public via the SHG website www.sainthelena.gov.sh or from the Clerk of Councils at the Castle on telephone 2470.


 


Your Elected Representatives remain committed to creating a sustainable and prosperous future for St Helena and its citizens. 


 


They will ensure members of the public are updated on a regular basis about the progress of the Working Group established to review the Customs Tariffís.


 


Yours sincerely


 


 


Anita Legg, Secretary - on behalf of Elected Members


 

 

This article is the Property and Copyright of Saint Helena Herald.

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