Chamber says VAT remains ‘red line’
The Gibraltar Chamber of Commerce said the introduction of VAT in Gibraltar would continue to be a “red line”, adding that its position on this “remains unchanged”.
This comes after the newly elected President, John Isola, was quizzed by GBC on the possible introduction of VAT in Gibraltar in the context of the ongoing discussions between the UK on behalf of Gibraltar and the EU.
In a statement to the press the Chamber said the introduction of VAT “would not be in Gibraltar’s interests and would make our economy less competitive”.
“This follows wide consultation with our member s in the sectors that would be affected by such a move,” a Chamber spokesman said.
“In his GBC interview the Chamber President was highlighting the need for local businesses to be flexible in general terms for the good of the economy and the community overall but this would be in the context and depend upon what the terms of any treaty might be.”
“Gibraltar needs to remain competitive in the future.”
The Chamber spokesman said its position is clearly set out in the December edition of its members’ magazine, Gibraltar Business.
The Chamber said its members in the retail and wholesale sectors are “overwhelmingly against” the introduction of VAT in Gibraltar.
“Loading another cost on local businesses would make it even more difficult for them to compete in the aftermath of the Covid-19 pandemic,” the Chamber said in its magazine.
“If any price advantage which Gibraltar enjoys were to be eroded further it could do irreparable damage to important parts of Gibraltar’s commercial fabric.”
It also cited the “knock-on effect” this would have on employment in these sectors, especially cross-frontier workers, adding that there would be “less prosperity to share”.
The Chamber said a move to introduce VAT would be “self-defeating for all parties”.
The Chamber said it would not be making any further comment on the possible outcome of the treaty until the full text of any agreement has been published.