The Scottish Government

« Previous | Contents | Next »

Listen

CHAPTER TWELVE: ADDITIONAL COMMENTS

ADDITIONAL COMMENTS

12.1 Question 24 asked "If a local income tax is introduced, what would be the most significant factor (good or bad) for you?" and offered a choice of options or the opportunity to add another answer.

Individual responses

12.2 As well as replying to this question, many respondents took the opportunity to make general additional points. The following response rates were given to the options given in the consultation paper.

• a local income tax would be fairer than the council tax (41%);
• I/ my household will be worse off (27%);
• it will help to make Scotland a wealthier and fairer place to live and work (7%);
• I/ my household will be better off (6%);
• the council tax will be abolished (5%).

In addition to those options, people added a number of their own comments. The following comments were raised by 10 or more individuals themselves.

• a local income tax would be unfair;
• general disagreement with local income tax;
• support for revising the council tax/ some form of property tax;
• people/ I will leave Scotland;
• local income tax will be unfair to earners;
• general support for local income tax;
• that council tax is unfair;
• local income tax will be costly to introduce;
• local income tax will favour the unemployed.

12.3 Six out of the 12 free-flowing responses from individuals took the opportunity to comment on significant factors. All 6 responses revealed concerns:

• constitutional legality/ competence (2 individuals);
• the trend towards centralisation of revenue-raising power (1);
• the possibility of a skills brain drain (1);
• the impact on local jobs and the potential removal of council tax benefit (1);
• the majority of Scots being subsidized by a hardworking minority (1).

Organisational responses

12.4 Included in the free-flowing or comprehensive responses were a number of general comments about the proposed changes to the tax system; some of these are summarised below:

• the first stage in determining the overall position is to define a set of principles against which any system of taxation could be assessed (local government organisation);
• no system is likely to be the most suitable for all the factors and a degree of value judgement may be required in considering the pros and cons of different taxation systems (local government organisation);
• there needs to be consideration of some of the more fundamental issues which logically need to be debated and resolved first (retail/ business organisation);
• proposals to change the system of local government taxation can be fraught with difficulty (local government organisation);
• the abolition of council tax provides a valuable opportunity to develop a new system of taxation to fund local services that will help to alleviate poverty among many thousands of workers and their families by shifting more of the burden of paying for local services to those who can afford to pay from those who cannot (trade union);
• any change to the current form of local taxation system is highly political, and stimulates debate around a wide range of political views (local government organisation);
• any tax system should be fair, progressive, stable and collectable - all forms of taxation have weaknesses (local government).

12.5 Other issues which arose in organisational responses included the following key points:

The Local Government Finance Review Committee Report

12.6 Sixteen organisations made reference to the Local Government Finance Review Committee Report 'A Fairer Way' (also referred to as the 'Burt Report') in their response to the consultation; of these, 10 were local government, 2 tax, pay or finance, with one each from the equality, legal, representative, and retail/ business organisation types. Three expressed concern over the concept of 'fiscal flight' as outlined in the 2006 Report. Two organisations queried the issues of: local accountability; costs of implementation; and the apparent dismissal of that committee publication by the Scottish Government.

12.7 Other organisations focused on disparate issues brought forward by the Burt Report, the following points were raised by one organisation each:

• a concern over local income tax as a replacement for council tax;
• a query over the fairness of local income tax;
• a comment on the centrality of property as a reliable tax base.

The need for detail and clarity

12.8 Eight organisational responses (3 representative, 2 local government, 2 tax, pay or finance, and one from retail/ business) pointed out potential confusion with various aspects of the proposal and the need for greater clarity overall:

• Three of these groups desired a simple and transparent approach to minimise such confusion.
• Two identified possible confusion between the local income tax rate of 3% and the Scottish Variable Rate.
• One organisation wondered how taxation appeals would be undertaken.
• One organisation requested confirmation on who was liable to pay local income tax.
• Another of these responses predicted continuing difficulties in the working relationship between central and local governments in attempting to administer the proposed tax and argued for increasing political decentralisation along European lines.

12.9 A further 7 (4 local government, and one each from political, retail/ business and tax, pay or finance organisations) expressed some concern over legal issues, in particular the issue of legal competency related to the Scottish Government's working relationship with the UK Treasury in implementing local income tax.

12.10 Overall ambiguity was mentioned as a problem by 5 organisations (3 local government and 2 tax, pay or finance), who cited the unspecific nature of 'personal allowances', lack of technical information, and a need for greater clarity as reasons.

Domestic water charges

12.11 Domestic water charges are currently billed alongside the council tax and the Scottish Government intends to progress changes to water charging seperately. However, this topic was mentioned in several responses with 2 individuals and 10 organisations requesting more information on proposals for water charges.

COMMENTS ON THE CONSULTATION PROCESS

Individual responses

12.12 Two percent of individuals responding to the consultation questionnaire included comments on the consultation document in their answer to question 24 indicating they would have liked to see proposals for other alternatives. There were also comments, from 2%, that the consultation document should have contained more information or detail on proposals.

12.13 In the free-flowing individual responses there were negative comments from 4 respondents on the consultation document which they felt lacked sufficient detail and information.

Organisational responses

12.14 Some organisations raised issues relating to the consultation document or questionnaire:

• Eleven organisations (4 representative, with one each from equality, IT, legal, retail/ business, tax, pay or finance, and trade unions) felt that further consultation and additional research was necessary in order to make more informed judgements about the proposed tax.
• Five cited inadequate information, including 2 representative organisations, and one each from the IT, legal, and retail/ business groupings.
• One organisation wanted to see a 're-run' of the exercise once additional research had been conducted or details agreed.

12.15 There were comments from 24 organisations who felt unable to respond to some or all of the consultation questions as they felt that the consultation was targeted at individuals; these organisations submitted their responses in either a free-flowing format or answered the questions they felt were applicable. There were suggestions that another version could have been made available for organisations.

« Previous | Contents | Next »