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SNP tax plans attacked |
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Wednesday, 12 March 2008 |
The Government’s plans to replace council tax with a local income tax came under severe attack yesterday after Cabinet Secretary for Finance John Swinney launched the official consultation on the issue.
Swinney said his preferred option is for 3p local income tax that would be collected by Her Majesty’s Revenue and Customs. He also said that the Government expected to still receive £400m annually in council tax benefit from Westminster, but admitted that that £280m would have to be found for 2011-12 to keep the tax at 3p.
HMRC has said previously it will only collect national taxes, while UK Minister, and the Burt Review, have stated that council tax benefit would cease if a local income tax were introduced.
Labour immediately attacked the plan as a ‘tax on jobs’ while the Tories argued that a 25 per cent cut in council tax would deliver better results. The Lib Dems agree with the idea of a local income tax in principle but have yet to declare their hand on any negotiations about securing the passage of such legislation through the parliament.
Swinney said the tax would be fairer, and that only the top ten per cent of earners would pay more under his scheme:
“The vast majority will be better off and the local income tax will benefit most those earning the least. Most households will pay less tax and we will put more money back into people's pockets. These proposals represent a reduction in the tax burden on Scotland.”
Scottish Labour leader Wendy Alexander attacked the plan, saying:
“It will make Scots workers the highest taxed in the UK. This Scottish jobs tax will hit the pay packets of every hardworking Scot. There is nothing fair about the super rich getting off Scot free. And nothing just about making hardworking Scots pay at least 15 per cent more in income tax than the rest of the UK. It will also inflate house prices and make it even harder for first time buyers to get on the property ladder. The 3p rate will cover only half the amount services currently provided by local authorities. To maintain current services the 3p cap will have to come off.”
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