Join the Socialist Party Join us today!

Printable version Printable version

Facebook   Twitter

Link to this page: https://www.socialistparty.org.uk/issue/547/6376

From The Socialist newspaper, 10 September 2008

Scotland council tax to be scrapped

The SNP government has set out its proposal to scrap the discredited council tax and replace it with a local income tax (LIT). Without a majority in the Scottish parliament, the SNP will have to rely on backing from the Lib Dems, Greens and independents to get this change through.

Brian Smith and Philip Stott

The SNP was elected in May 2007 with a pledge to abolish the council tax. It will not be until 2011 at the earliest before we see the back of it. In the meantime local authorities have agreed to freeze the tax at its current rate for three years.

The council tax is regressive, benefiting the rich, and is widely despised. Socialists have campaigned for its scrapping and replacement with a tax based on ability to pay for years. Tommy Sheridan laid a bill in the Scottish parliament to abolish the council tax in February 2006 and ironically the SNP voted against it.

The SNP's scheme is in fact a modified version of Tommy's proposal. Its plan is for a 3p in the pound LIT, collected through the PAYE system. Scotland finance secretary, John Swinney, claims that over 80% of households will be better off or no worse off. The examples cited include a pensioner on under 20,000 paying LIT of 374, and a worker earning 25,000 paying 593.

Clearly the number of workers in the household is crucial if comparisons are to made with the council tax. In fact a working couple, both on 25,000 would pay over 1,000 a year in LIT, making little difference compared to the current council tax.

However there is no doubt that in terms of fairness the SNP's plans are more progressive than the council tax. Accountants KPMG, tax avoidance specialists of the super-rich, said that the plans will lead to many high earners leaving the country. Brian Souter, Stagecoach boss, would pay 28,750 instead of 1,930 and Fred Goodwin, RBS chairman, would have to cough up 120,000 rather than his current 2,338. Low-paid workers and pensioners living in poverty will no doubt charge down to the airport to wave off poor Brian and Fred.

Shortfall

The LIT will raise significantly less money than the council tax, creating a 750 million shortfall. The SNP says this will be covered through the money currently paid from the UK government to people who qualify for council tax benefit and from the 2% annual "efficiency savings" that they have demanded from local government.

The SNP's position is that the 400 million of council tax benefit is "Scotland's money", but the UK treasury has floated the idea that if the council tax is abolished in Scotland then they are under no obligation to place this 400 million in the annual Scottish block grant.

The SNP have also said that another 70 million will have to be found each year to sustain the rate at 3% in the long term.

There are also additional one-off costs in setting up the new tax and an ongoing yearly cost of administering it, so it is clear that the SNP's plans would not increase funding for local government services (unlike the Service Tax promoted by Tommy Sheridan) and would probably in fact lead to further spending cuts.

It would be churlish not to treat seriously any plans that seek to replace the council tax with a more progressive scheme. However, the SNP's proposals could have been even more progressive if they had adopted a multi-tiered rate that saw the rate of LIT increase as income rose, rather than a flat rate one.

A more punitive redistributive tax on the rich could also raise enough money to maintain or even increase local government spending.

Public spending cuts are not what local government workers and the communities they serve, hoped would be the outcome of abolishing the council tax.

What is required, alongside a progressive alternative to the council tax, is a decisive increase in local government funding. This could not only maintain jobs and services and allow a living wage for council workers, but also deliver a real expansion of local government to meet the needs of working-class communities. Unfortunately, the SNP shows no signs of fighting for that.

Why not click here to join the Socialist Party, or click here to donate to the Socialist Party.


In The Socialist 10 September 2008:

Housing Crisis: Brown has no answers


War and occupation

End the wars and occupations

USA: Defying police, students walk out against the Republican national convention


Socialist Party editorial

US mortgage bank nationalisation - sign of deepening crisis


Scotland

Scotland council tax to be scrapped

Scotland: Council pay battle at critical stage


Socialist Party workplace news

Workers' anger surfaces at TUC

London bus workers inspired by strike

Fighting for decent pensions

In brief


Socialism 2008

Come to Socialism 2008!


Socialist Party campaigns

May Day detainees fight for justice

No to post office closures

Boom to bust in Cardiff Bay

Fans pay for the success of the 'beautiful game'

Protest against harassment!


Socialist Students

Fighting start to freshers fairs

Young workers ripped off

Bangor University students union fees referendum


Environment and socialism

Can we have 'the right to travel' - without adding to climate change?


Socialist Party review

Richard Dawkins: The genius of Charles Darwin, (Channel 4)


International socialist news and analysis

Thailand in grip of political deadlock


 

Home   |   The Socialist 10 September 2008   |   Join the Socialist Party

Subscribe   |   Donate  




Related links:

Tax:

triangleCardiff East Socialist Party: How we beat the Poll Tax

triangleTurn Carillion crisis into movement against privatisation and capitalism

triangleCardiff West Socialist Party: How the Poll Tax was beaten

triangleThe Socialist Inbox

triangleTrump's tax plan: Robin Hood in reverse

Scotland:

triangleUndercover policing legal challenge

triangleWhat does the left victory in Scottish Labour mean?

triangleScotland: BiFab workers' occupation and march secures jobs and pay guarantee

triangleCardiff East Socialist Party: Catalonia, Scotland and Wales

Council tax:

triangleBristol anti-cuts campaigners debate alternatives to the cuts

triangleThousands live in tents and sheds - seize empty homes

triangleBristol's Labour mayor calls anti-austerity march - now stop making cuts!

SNP:

triangleWhere is Scotland going?

triangleScotland - SNP loses but Labour could've won more

Local government:

triangleLocal government workers' reps reject 2% pay offer

Reports and campaigns

Reports and campaigns

22/2/18

UCU

Lecturers strike around country in defence of pensions

21/2/18

Strike

German engineering strike puts shorter week on agenda - but could have won more

21/2/18

Cardiff

Cardiff Refugee Rights gig success

21/2/18

Nottingham

Nottingham hospital black alert

21/2/18

East Midlands

Lively discussion at East Midlands Socialist Party conference

21/2/18

West Midlands

Tremendous determination on show at West Midlands conference

21/2/18

Wales

Successful Socialist Party Wales conference sets tone for the year ahead

21/2/18

Bradford

Bradford protests against kids' service cuts

21/2/18

May Day

May Day, May Day! Celebrate solidarity!

21/2/18

Kirklees

Labour councillors push through savage cuts in Kirklees budget

21/2/18

Salford

Save Salford nurseries!

21/2/18

Caerphilly

Victory: Pontllanfraith leisure centre saved

21/2/18

Council

Northants council crisis - protesters demand an end to cuts and privatisation

21/2/18

Leicester

Leicester Uni makes Tory fee tripler David Willetts chancellor - sack Willetts!

21/2/18

UCU

Bosses divided - university pension strikes can win!

triangleMore Reports and campaigns articles...


Join the Socialist Party
Subscribe to Socialist Party publications
Donate to the Socialist Party
Socialist Party Facebook page
Socialist Party on Twitter
Visit us on Youtube

LATEST POSTS

CONTACT US

Phone our national office on 020 8988 8777

Email: info@socialistparty.org.uk

Locate your nearest Socialist Party branch Text your name and postcode to 07761 818 206

Regional Socialist Party organisers:

Eastern: 0798 202 1969

East Mids: 0773 797 8057

London: 020 8988 8786

North East: 0191 421 6230

North West 07769 611 320

South East: 020 8988 8777

South West: 07759 796 478

Southern: 07833 681910

Wales: 07935 391 947

West Mids: 02476 555 620

Yorkshire: 0114 264 6551

ABOUT US

ARCHIVE

Alphabetical listing


February 2018

January 2018

2017

2016

2015

2014

2013

2012

2011

2010

2009

2008

2007

2006

2005

2004

2003

2002

2001

2000

1999