Remember the rates? They caused uproar across the country until replaced by the community charge which offended every democrat (who wasn’t saving hundreds a year) and helped to usher out Margaret Thatcher. Council tax, dating from the early nineties, may be as unpopular but it has one strength – the collection rate is over 95 per cent because it’s based on a property, a fixed asset, rather than a mobile and devious individual taxpayer.
Ease of collection and the fact voters find it easy to understand means it has an appeal to governments, in the same way the Barnett Formula has survived so long. They moan about it in London but to the Civil Service it’s a simple calculation that streamlines the distribution process.
It was revealing that the cross-party group on reforming local taxation failed to come up with an agreed alternative and offered instead a range of options to be taken together. They preferred a mix of tax sources. If that looks like a cop-out, in a sense, it is. There is no precise and fair system which will bring in enough revenue which is why the government has come up with the plan to let councils keep a share of income tax if they build up economic growth in their area and to tax empty land. That could amount to a sizeable sum.
They have tinkered with payment levels in the existing council tax bands to generate a marginal amount – £100m – but in a way that hardly anyone will find unpalatable. Mine is likely to cost £9 or £10 more a month. There will be refunds and exemptions but the simplest part is that those living in 75 per cent of homes will be unaffected.
This trumps Labour’s offer of charging everyone a penny more in the pound and asking them to negotiate a refund system from councils (who aren’t the taxing authority). There is still a check on local government with a 3 per cent limit on future rises and the extra money raised from the E to H higher bands will be allocated to education – both to combat the attainment gap and again to outflank Labour. To those who argue this is undemocratic and distribution should be left to local authorities, I simply ask: What happened to nearly £1 billion of anti poverty funds given by the government to councils without ring-fencing? As oor Jackie Baillie will tell you – it ‘disappeared’ and not into the pockets of the poor.
There is a major disappointment here. Months of work by a cross-party group after statements indicating SNP support for abolition of the council tax and all the government comes up with is an amendment. It is cautious to the point of timidity. Personally, I favour a land tax and local sales tax as fair and collectable and I’m far from alone in bemoaning what may the last opportunity of years of getting to grips with local taxes and council accountability.
But am I surprised? Of course not. Today we are 64 days from voting in the Holyrood elections. How naive would it be to herald a massive reorganisation which sends people scurrying to find out how it affects them only to find there are no answers yet?
The Greens and the Left are astonished and angry but really, would they announce radical reform just ahead of a vote? There surely is a failure here to differentiate between principle and politics. Just because something seems to be the right thing to do, doesn’t mean it’s justified to a politician who is balancing people’s opinions with his or her own political interest. Somebody asks: Why not be radical when you’re at 60 per cent in the polls? But that’s exactly why you don’t take a risk. You’ve got the votes already and all you can do is lose them. The starry-eyed belief that people will just follow a good idea rather than their self interest at election time is disproved time and again. Before any major reform a prolonged period of information is needed to familiarise people with the changes and that was never going to happen in early 2016.
So instead of scary headlines about confusion and concern and unknown costs, the SNP gets this in the BBC: Highest council tax bands ‘to pay more’ says Nicola Sturgeon
Who’s going to argue with that? And, to be brutally honest, is a wider Scottish public going to turn on the words of radical groups who garner between six and nine per cent in the latest polls? (List only). Sorry…
Time and again the sections of opinion which are most radical fail to grasp the gritty reality of politics – that it is a compromise-based activity. That is the SNP’s road to success – built on capturing the centre ground. There is a reason why more doctrinaire parties have small support. It doesn’t make them wrong – on the contrary, in the case of the Greens, it looks increasingly as if their time is coming in terms of the environmental argument – it just puts them at odds with the public who may broadly agree but are fearful of anything that sounds dogmatic. You must do it this way because I’m sure I’m right. Indeed, they are suspicious of anything that sounds inflexible or unreasonable and lacks perspective. They rejected the Nationalists as such for decades until they softened their stance on Europe, accepted devolution as a reasonable advance and engaged in the wider debate on a full range of domestic policies. Promising to overhaul the entire system with no clear signpost to winners and losers nor even general consensus of what it should be, represents risk no sane leader would take. It will be interesting to see if the argument continues after the election and forces another and more radical re-think. It’s certainly fertile ground for Greens.
I maintain that for most Scots the campaign for a separate state is as radical as they get. They will look and, I suspect, applaud a package which
Doesn’t confront them with a dazzling new tax system
Is easy to understand
Ends the discredited council tax freeze
Leaves those in cheaper homes untouched
Gives an increased discount to low income families
Charges more to the better off
Doesn’t antagonise higher earners
Raises extra money which must go into education
Limits future council tax rises to 3 per cent
Embraces the prospect of a land tax
And allows councils to gain tax revenue from creating growth
At least the Greens have an alternative. It’s not clear to me that Labour have a worked-out plan to replace council tax, nor have the Conservatives, nor COLSA who all routinely complain. In fact the Tories didn’t even deign to take part in the discussions.
This is a disappointing package for any, like me, who don’t just want reform of local taxation but would like our entire tax system reviewed, streamlined and simplified from corporation tax and national insurance to council tax. The role, structure and funding of councils should be in there too.
But let’s not pretend this isn’t good politics. It’s exactly what you’d expect so near an election and will enforce SNP credentials. As soon as the critics open up, they will say only the better off pay more, the poor are protected and the money goes to our schools – guaranteed. Oh, and what’s your council tax replacement plan, Kezia?