Local politician Sark aims to decrease property taxes for residential homes within the local market
In a bid to support local buyers and sellers, a proposal to reduce the tax for local properties is gaining traction in Guernsey. The policy and finance committee has put forward this proposal, which, if approved, will see the law officers of Guernsey drawing up the different rates.
Currently, all properties, both open and local market, are subject to a flat rate of property transfer tax at 7.5%. However, under this new proposal, the tax rate for local market properties would be lowered to 4%.
The aim of this proposal is to make property transactions more accessible within the local market. Notably, open market homes will still be subject to the 7.5% transfer tax after sale.
The Sark's Chief Pleas is also considering a similar proposal to reduce the property transfer tax on local market properties. Last year, the Chief Pleas identified a loophole that allowed companies owning real estate to avoid paying the property transfer fee without updating the central property register after a sale.
The chair of Policy & Finance, Conseiller John Guille, has expressed his support for this proposal. However, he also raised the issue that all property owners would be subject to some form of taxation if transactions take place.
To prevent losses of revenue from the government's small tax net, other taxes, such as an annual tax on homes levied on companies which own residential property over a certain value, have been considered.
The policy and finance committee will present this proposal to the island's parliament on 1 October. Once the law officers have drawn up the rates, new legislation will need to be presented to the Chief Pleas again.
It's important to note that the search results do not explicitly name the politician who proposed the reduction of local property taxes.
The Chief Pleas' revenue from its 2024 budget brought in £1.8m, a figure that could potentially be affected by this proposed change in property taxes.
Stay tuned for more updates on this developing story.
