As discussed in Has there been a breach of the Public Markets Trust? the saga over whether or not GST is chargeable on the rents here is still ongoing.
It is incredibly frustrating that I still cannot get a straight answer out of anyone, so perhaps readers might want to put forth their thoughts on the matter.
Having served on the appropriate agents both a notice of understanding and intent and a notice of default which went unanswered, I duly paid the rent without GST on the following proviso:
Under the Goods and Services Tax (Jersey) Law 2007 GST is only chargeable on the basis set forth in Article 6 (1) (a) of the said Law. It is reproduced below for your ease of reference -
6 Charge to GST
(1) GST shall be charged –
(a) on the supply of goods or services in Jersey, if the supply is a taxable supply made by a taxable person in the course or furtherance of any business carried on by the person;
However under Article 3 of the Loi (1885) Touchant L'Administration Des Marches Public the basis upon which the States of Jersey through their appointed representatives the Minister of Transport and Technical Services and the Inspector of Markets may charge rents is
3
Les États auront le droit d’émaner des Règlements pour le bon ordre, la police et l’entretien des Marchés, et pourront, comme par le passé, louer les boutiques, étaux et emplacements dans les Marchés, afin de subvenir aux frais qu’entraînent l’administration et l’entretien des Marchés
Translated this states that the rents which are charged are solely to cover the cost of administration and maintenance of the markets, the States of Jersey may not make a profit on the rental income.
Clearly the administration of the markets is on a trust basis and not on a commercial basis and therefore does not fall within the definition of a business under Article 2 of the Goods and Services Tax (Jersey) Law 2007 and as such the rents are not subject to any charge which is made with relation to this law.
When I received the invoice in December 2012 for the rent for quarter 1 of 2013 I immediately represented to your good selves that you had made an error in seeking to levy GST on the rents of the market.
You indicated that you had not made a mistake and thus we entered into dispute.
In line with the Law of Contract I immediately served upon the sole agent legally authorised to collect the rents; that being the Inspector of Markets, a Notice of Understanding and Intent, indicating that I would not pay the GST portion of the invoice unless you could demonstrate that it was due in Law.
In the absence of any response to this legal notice, after the expiry of 14 days, I served upon the Inspector of Markets a Notice of Default advising you that unless I received a response I would proceed on the basis outlined in the Notice of Understanding and Intent.
28 days have now expired since the Notice of Default was served and as such I now make payment of the invoice in respect of the rental for quarter one of 2013 on the premises 73,74 & 80 Central Market without the disputed sum in respect of GST. Such payment has been made by bank transfer.
Should you now wish to claim the amount in respect of GST, a Court hearing must be convened at which you will be required to first provide the Court with a good reason why you have acted with dishonour and failed to respond to the notices lawfully served upon you before the Court will deal with the dispute itself.
As I have now completed the legal process required when disputes arise in contract I have further advised all other tenants of the Public Markets of your error in seeking to charge GST on the rentals of the public markets.
Any further communication received on this issue, including but not limited to demands for payment or statements which show a balance due, will now incur a £20 administration charge, any response will further be charged at two thirds of the standard rate (£350 per hour or part thereof). To avoid incurring these charges please ensure that you take the necessary steps as they will not be waived.
I then received a letter assuring me that they still felt that GST was due, but giving no reasoning for this position. A letter for the most junior member of the shared services team was thoroughly rejected.
Thank you for 'your' letter, however it is insufficient simply to state 'we maintain that GST is due'. You do not make the law.
Please note that under the 1885 law the levying and collection of rents is the sole responsibility of the Inspector of Markets and the Minister of Transport and Technical Services, I therefore assume you are writing to me in their name and that they have approved your communication.
I have asked 'you' to show in law, that GST is chargeable, something which 'you' have again failed to do. I require 'your' full argument, and its basis in law, in order to be able to respond properly. I also require you to demonstrate why you did not respond to my earlier lawful notices in good time.
I have given 'you' the courtesy of pointing out the exact laws which clearly demonstrate that it is not, I expect a counter argument in the same terms, as indeed will the Court. It will also assist the Court if 'we' can agree the points of contention in advance and thus limit the time for which the Court has to deliberate on the matter.
Please initiate proceedings with all due haste as I would greatly like to have this matter concluded sooner rather than later and clearly I cannot initiate them.I then finally received a response from the head of Jersey Property Holdings, which simply stated, "We have taken legal advice and GST is chargeable".
To which unfortunately I had to reply,
The definition in law of a business is 'any activity or enterprise entered into for profit'. (Blacks Law Dictionary)
The 1885 Law clearly states that the States of Jersey and the Inspector of Markets are allowed to charge sufficient rents to cover the operating costs (specifically maintenance and administration), there is therefore no legal authority for the making of a profit because if there were it would specifically state this or would not include a list of expenses that are to be covered by the rents. This rule of legal interpretation is Expressio unius est exclusio alterius ("to name one thing excludes all others").
Without the intention to make a profit, it is not a business and therefore GST is not liable as this is only liable on commercial transactions. Under another rule of legal interpretation Generalia specialibus non derogant ("the general does not detract from the specific") it is clear that the general rules of the Goods and Services Law does not overrule the specific and special nature of the public markets in Jersey as specified in the 1885 Loi touchant l'administration des Marches Publiques.
I am afraid I cannot accept your assertion that you have taken legal advice without a) sight of that legal advice which highlights the specific part of the law that allows for profit to be made on the rents charged in the public markets or b) you are able to highlight to me the specific part of the law that allows for profit to be made on the rents charged in the public markets.
Should you be able to provide an explanation of where I have made an error in reaching my conclusion then I will concur GST is chargeable, otherwise please can we proceed and allow a Court of Law to deliberate on the matter. I am afraid that neither I nor indeed a Court of Law can simply take your vague assurance that it has been properly looked into and is correct, when I have provided a detailed argument with proof to the contrary.
I have been as clear and open as I can be on this matter, my argument is well founded in law and in return all I have heard is that either you don't agree or a vague assurance that someone else agrees with you. I trust you can understand my frustration at not being able to have a proper debate on this matter enabling us to reach an evidenced conclusion which we can mutually agree on.
I will however not be fobbed off with vague assurances particularly when my own friends in the legal profession accept my interpretation as correct.
I should therefore be grateful if you would proceed with all haste to initiate these proceedings as I am sure you can accept that it is in our mutual interest that this difference of opinion is resolved at the earliest opportunity.
