Lib Dems vow to ditch council tax

Plans to replace the council tax are to be unveiled by the Lib Dems, on the 15th anniversary of the poll tax riots.

The party says the council tax is unfair. It wants to see it replaced by a local income tax instead.

The party will launch its campaign with a bus tour in London - the day before council tax bands are re-assessed in England and Scotland.

Labour says it would reform the council tax, while the Tories are offering pensioners a rebate on their bills.

Year-on-year increases in council tax have sparked protests, particularly from pensioners who, because they are on a fixed income, have been hardest hit by rises.

news.bbc.co.uk...

I feel this is an excellent idea by the lib dems, most will agree with me on that, but im not sure if it will turn the voters around for them. Lib Dems are predicting that this is going to be there best election, hoping for victory, but one they need to focus on more issues

The problem with Lib Dem policy is that they are promising things they can't afford, taxes will go up for everyone not just the rich.

They've leapt blindly into the tax more spend more ideal.

Why do we need local taxes, why not stop local tax and increase national tax?
Or are their major flaws with this

It's meant to be all about local accountability and keeping decision making for local issues local (cue Edward and Tubs 'League of Gentlemen' quotes......"are you local", there's nothing for you around here" etc etc).

The objection with local sales taxes is that Britain is a fairly small place geographically, if local taxes were significantly different in say a borough of Kent compared to a borough of Essex or even Yorkshire it's not exactly hard for most Britons to jump into their car and spend their money on goods in the cheaper local.

It could be a nightmare with essential services suffering severe underfunding.

Similarly if local income taxes were introduced it could lead to movement of people to exploit the lower tax regime (a lot more long term that one I know).
You also risk the election of those who will promise the lowest levels of local tax and who would be quite happy to see local services (which includes schools and local health authorities don't forget) go threadbare.
(.....and notice the LibDems say around 30% would be worse off under their local income tax plans - and that is only at the start of it)

Basically the thing is a nightmare.

The point about property tax is that the property isn't going anywhere (unlike the several hundred thousand - millions? - of individuals who disappeared under the poll tax). So it's comparatively cheap and a fairly easy tax to administer.
They also put a degree dynamism into the housing market.
They introduce a degree of 'pressure' for elderly people to leave large family homes when the family have left, freeing up more suitable home for new families etc etc.
They also relate to the value of the home (obviously) and are 'progressive taxes' in that sense.
If you have a home worth a fortune (which usually means being well able to pay) you pay comparatively more.

In the end people don't like paying tax and I suppose (particularly here in the UK) we have a tendancy to aspire to ending up in a big house which we are loath to leave and trade down in later life.

My bet is the Council Tax will be reformed (all parties claim to want to do this) but essentially remain recognisable (how else do you do a tax based on property?) with extra help and assistance available for those on low incomes (particularly pensioners).



[edit on 22-4-2005 by sminkeypinkey]