Income tax is not on Government's agenda and that's just as well because most ruling party MPs are not too keen on the idea, judging from a random survey conducted recently.

But some, like labour leader Derrick Burgess and backbenchers Dale Butler and Wayne Perinchief, are intrigued by the tax system in the Channel Island of Jersey and said it would not hurt for a Parliamentary committee to examine it.

That proposal was first mooted by the late Sir John Plowman, a former United Bermuda Party (UBP) stalwart.

Ten Progressive Labour Party (PLP) MPs were called this week and asked for their thoughts on whether Bermudians should be taxed a percentage of their income.

“I would not be in favour of it, but it does raise the question of how we deal with the question of tremendous disparity of income in this Country where we have got people earning $400,000 in an office with people earning $40,000,” said backbencher Dale Butler.

Mr. Butler said legislators should not be shy about examining the issue.

“It should be debated, a committee should be set up. But I believe the majority of the population are not in favour of it and I don't think it's the answer the Country is looking to. The world looks at us with amazement as to how we can have a society where there's such a disparity in income. It's a massive disparity.”

In 1994 Sir John urged his party, then in Government, to consider a flat-rate income tax for Bermuda similar to that used in Jersey.

He proposed an independent review and said then that the current system was hurting tourism, was inequitable and was destabilising society.

Sir John suggested that a flat rate tax on income would allow the Island to slash customs duty by at least 60 percent and allow Bermuda to raise money for public services.

An offshore financial centre with a population of close to 90,000, Jersey charges its residents 20 percent on income above a certain threshold. Exemptions and allowances are given in a host of cases such as payments for a child's education and for senior citizens.

Mr. Butler admitted to being somewhat intrigued by the Jersey system but he said he doubted whether Parliament would set up a committee to study the tax code and debate its findings in the House of Assembly because of the taboo nature of the subject.

“That's our responsibility but no one is prepared to table a motion because you are going to be tainted for it. And the media is, unfortunately, not as objective as it should be.”

He also called for the release of a study on Bermuda's tax system so that MPs can be as fully informed as possible.

“If in that report there is something which highlights Bermuda should consider it, I should be privy to it. I feel I'm at a disadvantage which is not fair.”

Mr. Burgess agreed that the review, initially commissioned in 1998 by the UBP Government, should at least be released to Parliamentarians.

He decried the current tax system as “cumbersome” saying there had to be a better way.

“I think we have to look at our tax system within the next five years. I just don't think the system we have is the greatest,” he said.

“I would certainly like us to look at what they do in the Channel Islands but I don't want income tax like they have in the US and the UK.”

Mr. Perinchief echoed those sentiments, saying that direct income tax can impact negatively on productivity.

“I'm too old to be a socialist,” he said.

“Too pragmatic.”

He said some form of reform was needed because taxes like payroll tax, based on employees' income, is “killing small business”.

“Most small businesses are lucky if they make 25 percent on their investments after taxes,” Mr. Perinchief said.

But, he pointed out that many international businesses are completely tax exempt.

The backbencher said changes should only be made after an in-depth study and dialogue with the Island's companies have taken place.

He defended the fact that Government has not yet released the tax review, explaining that the information may be too sensitive given that Government has not yet decided the way forward.

“I am not in favour of releasing information for the sake of putting it in the public domain because it can be misused or used for propaganda.

“If our Government has not formulated a policy going forward it would be foolhardy to give out that information willy nilly and have the Opposition or anybody else using it to campaign against it.”

Backbencher Delaey Robinson stood out as being the only one of his colleagues with strong feelings on income tax which has long been dropped from his party's platform.

Even so, Mr. Robinson, the most recent and vocal advocate of progressive tax on income (where the rate increases with earnings), says there's no big hurry to overhaul the tax system.

“The party knows how I think and I do think long term,” he said.

“In the long term the tax code needs to be reviewed to help small businesses survive” and to meet an ever increasing social welfare bill.

Mr. Robinson is also concerned that the current tax system imposes an unfair burden on low wage earners.

Arthur Hodgson, who has in the past been reported to be in favour of income tax, is off the Island and could not be reached.

Southampton East MP Reginald Burrows agreed that taxation based on income would be fairer than the current consumption based taxes, but he is quite sceptical.

“If it is set up properly and everybody adheres to it, it's the fairest system.

“But it doesn't always work that way” because people with highest incomes tend to find a way around it.

He and several other MPs stressed that the matter had not been discussed by the party in years.

Environment Minister Dennis Lister said a thorough study should show Bermuda the best options.

“Like any jurisdiction review of the tax structure is always part of what government would do. But to associate a review with income tax is mixing apples and oranges. Naysayers do just that when they mention a review they automatically take you down the road to income tax. I personally think we have to take a strong look at our structure and a review of that structure will dictate what is the best thing for Bermuda. It could mean that what we have is the best thing for Bermuda.”

Some ruling party politicians feared the media was up to some mischief when this newspaper called.

“I have absolutely no comment to make about that nonsense,” said Works and Engineering Minister Alex Scott. “I have no opinion.”

The source of his irritation was a recent report, denied by Government, which alleged a “secret bid” by Government to hire consultants from Canadian tax authorities to look at how income tax could be applied to Bermuda.