The States of Guernsey Annual Budget for 2027

Policy & Resources Committee

Details

The States are asked to decide whether, after consideration of the Policy Letter entitled “States of Guernsey Budget, 2027”, they are of the opinion:

  1. To agree the amount of tax relief in respect of mortgage interest paid on a principal private residence as £2,000 for 2027, £1,000 for 2028, and zero for 2029 and future years.
  2. To increase the amount of bank interest exempt from tax, as provided for in section 40(kk) of the Income Tax (Guernsey) Law 1975, from £50 to £75.
  3. To increase the limit on the amount of income tax payable by an individual resident in Guernsey in respect of qualifying income from £160,000 to £171,000, and in the case of an individual in respect of both qualifying and non-qualifying income from £320,000 to £342,000 and in paragraph I of the Sixth Schedule to the Income Tax (Guernsey) Law, 1975 – (a) for “£160,000” in both places appearing substitute “£171,000” (b) for “£320,000” in both places appearing substitute “£342,000”
  4. To increase the limit on the amount of income tax an individual resident in Guernsey can pay under paragraph 3 of the Sixth Schedule to the Income Tax (Guernsey) Law 1975 (the “Open Market Tax Cap”) in line with inflation to £65,000 for 2027 and, to provide certainty for those claiming the cap, to agree subsequent increases of £10,000 for each of the next 3 years (increasing the amount payable to £75,000 for 2028, £85,000 for 2029 and £95,000 for 2030); also increasing the amount of document duty (or anti-avoidance duty paid under the Document Duty (Anti-Avoidance) (Guernsey) Law 2017) needing to be paid on the purchase of a property on Part A of the Open Market Register, (or the purchase of all the shares of a relevant company or other relevant transaction for the purposes of the Anti-Avoidance Law), by RPIX, from £50,000 (where the level has been since the caps introduction in 2018) to £70,000, for properties purchased (or shares purchased or in respect of any other such relevant transaction) on or after 1 January 2027.
  5. To agree to increasing the Tax Caps that an individual resident in Guernsey can pay under paragraphs 1 and 3 of the Sixth Schedule to the Income Tax (Guernsey) Law 1975 (the Open Market Tax Cap, the cap applicable to qualifying income and the cap relating to worldwide income) by RPIX on an annual basis in future years.
  6. To endorse the intention of the Policy & Resources Committee to introduce an “Entrepreneur Tax Cap” into the Sixth Schedule of the Income Tax (Guernsey) Law 1975 as soon as practicable, the details of which will be worked up with the Committee for Economic Development.
  7. To increase the maximum aggregate amount of donations that may be made to Guernsey Registered Charities and be exempt from income tax in any year of charge, specified in section 64B(1)(d) of the Income Tax (Guernsey) Law 1975, from £10,000 to £50,000.
  8. To agree:
    1. to amend the definition of “dependant” in Section 158 of the Income Tax (Guernsey) Law, 1975, in relation to Part XIII (pension schemes, retirement annuity schemes and retirement annuity trust schemes), to that as set out in the Revenue Service Practice Notes on occupational and retirement annuity schemes;
    2. to introduce the term “nominee” into Part XIII of the Income Tax (Guernsey) Law, 1975 with the meaning of an individual nominated by a member of a pension scheme or an individual nominated by the scheme trustee or scheme administrator, who may receive an annuity on the member’s death;
    3. to introduce the term “successor” into Part XIII of the Income Tax (Guernsey) Law 1975 with the meaning of an individual being assigned as a successor by a dependant, a nominee, or by the scheme trustee/administrator to receive an annuity on the death of a member (where the nominees have died); and
    4. to introduce into Part XIII of the Income Tax (Guernsey) Law 1975, a hierarchal structure for the payment of death benefits, on the death of a member of a pension scheme. The order to be dependant, nominee then successor.
  10. To approve the draft Ordinance entitled “The Excise Duties (Budget) Ordinance, 2026” and to direct that the same shall have effect as an Ordinance of the States.
  11. To direct the Committee for Home Affairs to exercise its statutory powers in order that a duty-free relief of 50ml for vaping liquid is brought into force to coincide with the commencement of the “The Excise Duties (Budget) Ordinance, 2026”.
  12. To include recommendations on the appropriate differential between vaping liquid and tobacco products in the 2028 Budget Report for consideration and approval by the States of Deliberation, so that the agreed approach can inform future duty-setting decisions.
  13. To approve the draft Ordinance entitled “The Taxation of Real Property (Guernsey and Alderney) (Amendment) Ordinance, 2026” and to direct that the same shall have effect as an Ordinance of the States.
  14. To approve the draft Ordinance entitled “The Document Duty (Rates) (Amendment) Ordinance, 2026” and to direct that the same shall have effect as an Ordinance of the States.
  15. To approve the draft Ordinance entitled “The Document Duty (Anti-Avoidance) (Rates) (Amendment) Ordinance, 2026” and to direct that the same shall have effect as an Ordinance of the States.
  16. To approve the draft Ordinance entitled “The Motor Taxation (First Registration Duty) (Guernsey) Ordinance, 2026” and to direct that the same shall have effect as an Ordinance of the States.
  17. To approve Committee Net Expenditure Option A for 2027 totalling £700.4 million as set out in Table 11, paragraph 6.27.
  18. Notwithstanding whether Proposition 16 has been approved –
    1. where it has been approved, to rescind that resolution, and
    2. to approve Committee Net Expenditure Option B for 2027 totalling £716.1 million as set out in Table 11 paragraph 6.27, and
    3. to rescind Resolution 10 of Billet d’État No II, 2026, and
    4. to direct the Policy & Resources Committee, working with all committees and service areas, to continue to identify and implement recurring expenditure savings with a cumulative value by 2029 (or as soon as possible thereafter, recognising that savings need to be sustainable and deliverable without undermining agreed service outcomes) of £20 million each year (with 2026 as the baseline year) through a structured programme including priority-based budgeting and other savings and efficiency measures, and to report annually on progress in the annual budget.
  20. To agree the allocation of £5 million from the existing £25 million unallocated Routine Capital Allocations for 2025 to 2028 to support the development and implementation of Spend-to-Save initiatives.
  21. To agree a multi-year budget of £15 million for the period 2027 to 2029 to fund the economic growth initiatives set out in paragraphs 6.98-6.109 of the 2027 Budget Report.
  22. To agree that funding from the Channel Islands Lottery (Guernsey) Fund be provided to support the operation of Beau Sejour Leisure Centre for the period 2027 to 2031, at up to £700,000 per annum, indexed annually for inflation and capped at the Centre’s operating deficit.
  23. To approve provision within the 2027 Budget for a transfer from the General Reserve to Guernsey Ports to fund its 2027 cash requirements estimated at £1.1 million.
  24. To authorise the Policy & Resources Committee to make annual transfers from General Revenue to Guernsey Waste, from 2027 onwards, equivalent to the forecast operating losses of Guernsey Waste excluding inert waste and depreciation, subject to a cap of £2.3 million in 2027, with the cap increasing annually thereafter in line with inflation.
  25. To approve the following Budgets for the year 2027: Guernsey Ports Guernsey Water Guernsey Waste States Works Guernsey Dairy Superannuation Fund Administration Committee for Employment & Social Security – Contributory Funds.
  26. That,
    1. subject to the provisions of the Income Tax (Guernsey) Law, 1975 and to the provisions of this Proposition, the allowances claimable for the Year of Charge 2027 by an individual solely or principally resident in Guernsey by way of relief from income tax at the individual standard rate, shall be the allowances specified in the First Schedule to this proposition;
    2. the allowances specified in the First Schedule to this proposition shall only be granted to an individual who has made a claim in accordance with the provisions of the Income Tax (Guernsey) Law, 1975 and who has proved the conditions applicable to such allowances and prescribed in the Second Schedule to this proposition have been fulfilled;
    3. “Family Allowances” means Family Allowances payable under the Family Allowances (Guernsey) Law, 1950 as amended; and
    4. “the Income Tax (Guernsey) Law, 1975” means that Law as amended, extended or applied by or under any other enactment and includes, where relevant, any Ordinance, regulation or Resolution of the States made under that Law.
  28. To direct the preparation of such legislation as may be necessary to give effect to the above decisions.

Timeline

  • Lodged on 5 October 2026
  • Scheduled on 5 October 2026