There will be a significant change for Jersey based consumers, and for ecommerce retailers selling to the Island, from the 1st of July when changes are made to Jersey GST.
- All sold to Jersey consumers will be subject to GST where the value of the imported goods exceeds £60 from 1 July 2023, if GST has not been accounted for at point of sale.
- This threshold is being reduced from £135 and will eventually be removed altogether.
- As a retailer, if your sales to consumers in Jersey exceeds £300,000 per annum, you will have to register and account for Jersey GST on all these sales.
- The rate of Jersey GST of nearly all goods is currently 5%.
- GST refunds should be automatic from businesses registered when refunding the cost of the goods.
- Consumers will have to apply to Customs for return refunds from non-registered businesses.
The purpose of the new legislation is to enable high street retailers in Jersey (who must charge Jersey GST on almost all sales) to be more competitive and also to mirror similar legislation introduced in relation to VAT in the UK and the EU during 2021.
The aims is to make ecommerce smoother than the current system and goods should be delivered to consumers more quickly – fewer packages will have to be held as if Jersey GST has already been accounted for by the seller the goods will then be imported to Jersey with no requirement to pay tax at the point of entry.
It will be interesting to see the impact of these changes, while there are plenty of retailers on the Island, it’s relatively small and so trade, particularly with the UK, is routine. However it will make ecommerce slightly less attractive than previously but say the Jersey authorities, it’s simply leveling the playing field with high street retailers based on the Island.
As an example, goods would attract 6% duty and 5% Jersey GST based on the cost of goods, carriage and duty. A £900 purchase with £60 carriage would result in VAT payable of just over fifty quid.
If you wish to register your business (or are obliged to do so) to pay GST in Jersey you can apply here.