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Guernsey faces the prospect of using up all of its savings within four years, unless it sorts out its tax deficit, says an island politician.

Deputy Roger Domaille, a member of Treasury and Resources, said the rainy day fund would be wiped out by then.

He said it was due to the so-called "black-hole" created when corporation tax was reduced to zero.

Deputy Domaille said islanders would only accept paying more tax when the States had cleaned up its own house.

He said solutions as radical as the introduction of a general sales tax, which the States is due to debate this week, would not be accepted until the government had made itself leaner.

Deputy Domaille said: "If we carry on as we are, then the contingency reserve fund, our savings for a rainy day, will be gone by 2014.

"I think the population of Guernsey would support any moves they can see to be considered fair and necessary.

"A lot of people would question what the States of Guernsey is doing to make themselves more leaner and fitter. In 2009 our expenditure rose by 7% in real terms."