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A taxing time

Brian Taylor | 15:19 UK time, Wednesday, 30 May 2007

The SNP plan to replace the council tax with a local income tax looks like it's in trouble.

Their sums don't add up. Not in the way that Labour and the Tories alleged during the election campaign.

This is more elementary arithmetic. As things stand, they don't have the votes to get the scheme through parliament.

John Swinney sounded suitably bold in Holyrood this afternoon when he confirmed that the executive would introduce a bill to scrap the council tax.

It was in the SNP manifesto, he said. It would happen.

Herewith the snags.

The Liberal Democrats are in favour of a Local Income Tax - but not the SNP scheme.

That's because the SNP proposes a fixed 3p levy on income tax - for all councils.

No local variation.

The Lib Dems say that runs counter to local democracy - and they won't vote for it.

Privately, I also suspect that more than a few senior Lib Dems harbour deeper doubts about LIT.

I think they wonder whether it's politically smart for them to be hammering middle class, aspirational multi-income families.

I think they fret over the fact that it doesn't cover unearned income.

The Greens are also against the SNP plan.

They say it replaces an unfair property tax with an unfair tax on income.

They'll vote against, urging Land Value Taxation instead.

Labour and the Tories want to retain the council tax, albeit with various reforms aimed at helping the elderly.

Do the sums.

As things stand, the SNP bill will go down.

They'll talk to the Lib Dems - but ministers remain presently thirled to their 3p fixed rate, arguing that the Lib Dem alternative introduces minor local variations at major administrative cost.

But, even if the government can get the LibDems on board, the other parties can outvote them.

Things might change - but, right now, I wouldn't bank on the council tax being scrapped any time soon.


  • 1.
  • At 04:11 PM on 30 May 2007,
  • Peter, Fife wrote:

This may well be playing politics, if the SNP place before Holyrood the main planks of policy in their manifesto and these are defeated it will be the other parties at Holyrood who will have prevented the wishes of the Scottish electorate coming to fruition; if the SNP do not place their manifesto promises before Holyrood they will be accused of abandoning all hope of passing their manifesto promises into law, ergo they could now be accused of Governing without electoral consent.

We need the Holyrood wreckers to be identified.

  • 2.
  • At 04:52 PM on 30 May 2007,
  • Åge Kruger wrote:

The problem with the LibDem's proposal is that what it calls "Local Democracy" is clearly what I would call a "Postcode Lottery". Under the LibDems plan, people in the cities could end up paying different rates to those in the suburbs, which is frankly ridiculous and just as unfair as the council tax it replaces.

  • 3.
  • At 06:46 PM on 30 May 2007,
  • David Tait wrote:

Entertaining as always but I think your analysis is a touch shallow and predictable. Scratch the surface, see what's underneath.

  • 4.
  • At 11:06 PM on 30 May 2007,
  • Donald Markie wrote:

A wee bit confused hear,does the 3p on tax mean only existing council tax payers will pay or is it every wage earner in the household who works will pay the 3p increase.???

  • 5.
  • At 11:53 PM on 30 May 2007,
  • derek barker wrote:

Yes Brian, on the big issues the snp stand motionless;yet!there is not an MSP that would agree with the current "COUNCIL TAX" and so;Brian you fox, the more i read your blogging the more i understand your comment(it's a new type of politic's)"YES" sir; if it's not consensus then it's nothing(once more into the trenches of political partisan-ship)it is in all it's wisdom now not a "QUESTION" about west lothian, it's a "QUESTION" about a Scottish parliament? has it the power to deliver? "WIILL IT STAY OR WILL IT GO"????????

  • 6.
  • At 05:02 AM on 31 May 2007,
  • Craig wrote:

Any ideas if this will be on taxable income only.
How will they enforce any income earned from abroad.

  • 7.
  • At 07:19 AM on 31 May 2007,
  • Derick fae Yell wrote:

Are you seriously suggesting the Liberal Democrats will deliberately vote down the SNP's Local Income Tax proposal on the basis of a minute and arcane difference in detail? A SNP policy on which the Libs completely agree with in principle, and which was one of the main planks of their manifesto? Hmmm, putting it that way - they probably will!

LibDems lost the political plot twice in a month! The idea of having a uniform tax across the country addresses such issues as commuters from one area going to work in a city in another council tax area - a common problem under the current system.

Rather than accepting the SNP proposal is better than the current council tax, the LibDems once again instist on their scheme or nothing with the result that we may get stuck with no progress at all rather than the SNP proposal which from the LibDem point of view isn't ideal but is still an improvement.

The LibDems just don't get the point of a minority government and like earlier in the month when they refused to sign up in coalition it sounds like once again they are throwing the dummy out of the pram.


  • 9.
  • At 08:18 AM on 31 May 2007,
  • Joseph, Maastricht, The Netherlands wrote:

In response post 1#,

Exactly what constitutes a mandate?, does the SNP winning more votes then any other party mean that if the other parties do not wish to scrap the council tax in favour of a local income tax mean that they are ignoring the views of the electorate?.

I think not, the SNP look very weak on the economy, I cannot see the Scottish public being very happy paying a local income tax, I imagine that this tax would be charged against everybody living in a house over the age of 18, does that make it a fair tax?, again I think not.

I would love to see the SNP do well, however, at the moment they are giving the other parties a lot of ammunition to discredit their policies.

Some thoughts on taxation for anyone interested.

And on property, and democracy.


  • 11.
  • At 01:08 PM on 31 May 2007,
  • ratzo wrote:

Neat sums isn't the issue. The libdems are in trouble and creating more. Their internal battles are having a knock-on effect at Holyrood. Increased council tax bills down the line will be a rod for the Unionist's own back not for the SNP.

  • 12.
  • At 02:53 PM on 31 May 2007,
  • G McConnachie wrote:


The wishes of the Scottish electorate do not equate to the policies of the administration. None of the political parties polled above one third of the vote. Nobody has a mandate to impose their policies on the electorate. Instead the parties must act on policies where they can find consensus. This is why they call it consensus politics! It is the job of the other parties to express the interests of the electorate that voted for them. If the administration cannot get a majority for a policy proposal its their own fault. They need to develop policy that has support of the majority of MSP's and hence reflects the wishes of the Scottish electorate. Wake up to the realities of proportional representation.

  • 13.
  • At 03:24 PM on 31 May 2007,
  • Harry Shanks wrote:

In response to Peter of Fife - It's perfectly clear who the wreckers are: it's the Lib Dems! Just 2 examples:

1) They are supposed to be in favour of democracy (how many years have they screamed for "Fair Votes") but they won't allow a referendum under any circumstances.

2)They are supposed to be in favour of scrapping the Council Tax in favour of Local Income tax (they stood on that platform in the Election), but they won't vote for it unless it's their precise scheme.

This attempted wrecking of the manifesto of the Party which WON the election is coming from the Party which came not even second or third, but LAST.

Of course it is not the duty of any other Party to support policies which they oppose, but in the case of the Council Tax abolition - this was one of the Lib Dems main pledges!

How on earth can the Lib Dems think they are honouring the wishes of their supporters by failing to support the Executive on this issue?

It seems that the Lib Dems big idea is that the winners should give way to the losers.

By that logic, Scotland might finally win the World Cup!

  • 14.
  • At 03:25 PM on 31 May 2007,
  • Matt wrote:

I do worry about the cost of implementing and running a local income tax. How are councils going to verify the income of everyone in their area? Will it be pay as you earn or will it be like tax credits and only assessed once per year resulting in big under or over payments? How will they determine how much self employed people with variable incomes have to pay?

At least with council tax it is fairly easy to work out how much a household has to pay.

  • 15.
  • At 10:33 AM on 01 Jun 2007,
  • Steve wrote:

An earlier poster said if this (and other) cornerstone policies of the SNP are defeated in Holyrood then the other parties will have ".. prevented the wishes of the Scottish Electorate coming to fruition."
It is worth remembering that these other parties MSPs have been elected to the parliament by 2/3 of the Scottish people. The wishes of the SNP are not the wishes of the majority of the Scottish People.

As far as "ability to pay" is concerned. When does ability to pay become punishment for success?

75% of local council funding comes from central funds, from the taxes that those "able to pay" already pay!

If the system gets any "fairer" then the "able to pay" will have nothing left!

I favour Land Value Tax, locally levied and used for local purposes. No need, in fact a prohibition on it being round-tripped to and from Central Funds and a dozen layers of accountants.

Let local folk decide the form of local government and find the money to pay for it.


  • 17.
  • At 10:46 AM on 03 Jun 2007,
  • archie wrote:

If the SNP really wanted to deliver this policy, they would have swallowed their pride and negotiated a coalition deal with the Lib Dems . This would have meant giving up on their independence referendum, but since this proposal is certain to fail in Parliament anyway, it's only SNP stubbornness that prevented this deal.

This would also have opened the door to a more formal coalition with the Greens, who could surely have been brought on board for the LIT vote if there were real environmental gains on offer elsewhere in the coalition agreement.

Instead, the SNP's choice was to insist on their doomed referendum plan and to go it alone, knowing full well that this means they cannot deliver the "votecatcher" policies that they campaigned on. But of course, when the proposal is voted down, it won't be the Nationalists' fault.

  • 18.
  • At 03:41 PM on 03 Jun 2007,
  • mary wrote:

As a first time visitor to the debating chamberthis wednesday it struck me how vulnerable both the main parties are and also how much more exciting things are going be this parliament! The excellent Pastor who led the Time for Reflection (Check it out) had it in a nutshell when he advised the MSP's to ask for wisdom for the good of the nation. Personalities will come into it and the Labour party are obviously hurt and licking their wounds but ultimately it has to be the good of the nation that each decision is based on. Gods wisdom would be useful too!

  • 19.
  • At 01:29 PM on 04 Jun 2007,
  • wrh wrote:

A bit late into this discussion. However, I often wonder why politicians do not look at ways of curbing local authority expenditure rather than simply taxing people through council tax, local income tax, or sales tax to pay for it.

  • 20.
  • At 09:26 PM on 04 Jun 2007,
  • DisgustedDorothy wrote:

Fed up with the Lib.Dems,would'nt care if they vanished from the political spectrum,less than useless and decidedly devious.
I do feel slightly sorry for Nichol whatshisface though.

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