The Financial Secretary has said that spending will be limited to 20 percent of the GDP so that the low tax regime may be retained without problems in balancing the budget. The Working Group on Long Term Fiscal Planning which was set up in June 2013 reported that additional tax revenue would need to be raised in future as there is likely to be a structural fiscal gap. As economic growth is set to continue the emphasis will however be on ensuring control of expenditure and broadening the tax base where possible. The attention of the Financial Secretary will be directed to protecting the tax base of the profits and salaries tax regimes. The priority is to keep the tax system competitive but opportunities will be taken to broaden the tax base and identify new revenue streams.
In the past there have been reviews of tax policy and a consultation on the introduction of a goods and services tax. Another review may be undertaken to look at ways to raise more revenue in view of the conclusions of the Working Group.
