Blogging from the Highlands of Scotland
'From fanaticism to barbarism is only one step' - Diderot

Wednesday, 14 March 2007

An interesting tax proposal from the SNP ...

... what do others think? The SNP is proposing to abolish Council Tax and replace it with a 3p hike in income tax rates, already provided for in the Scotland Act which set up devolved government in Scotland. The SNP say all but 10 per cent of 'top earners' would pay less tax, but that the new method would result in a reduction of GBP450m when compared with the current Council Tax, to be made up by grants to Councils from the Scottish Executive.

I'd want to see a proper independent analysis of the financial implications of these proposals, or publication of full details of the independent study the SNP says it has commissioned. I'd also like to know where the Scottish Executive is to source the additional GBP450m it says will be required to compensate Councils. Apart from that I'm not opposed in principle to the idea - except of course that I want to see government activity and the tax required to fund it reduced overall; it seems increasingly clear that their proposal to reduce the number of departments in the Scottish (which I wrote about here) is NOT designed with this in mind, but is instead desgined to concentrate the same or increased power in fewer hands - and this proposal to tie Councils even more closely to central government ('Scottish Executive' that is) funding than at present will make that aspect of the situation even worse than at present. There are also major imbalances in population density in different parts of Scotland (e.g. Glasgow and Strathclyde, as compared with the Highlands) which would seem to imply that there would be much greater deficits to fund, when compared with Council Tax, in low population density areas such as the Highlands than there are even now. So whilst as I say I am not opposed in principle to the SNP idea I do believe it needs to be subjected to the most intense independent appraisal so that the full implications are worked out in advance.

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