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MSP Briefing - Abolition of Council Tax
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MSP Briefing - Abolition of Council Tax

Introduction

This briefing sets out UNISON Scotland's position on the Abolition of the Council Tax and introduction of a Scottish Service Tax, which is to be debated at Stage one on Wednesday 1st February.

Local Government Finance

UNISON Scotland fully supports and welcomes the report of the Local Government Committee on the proposal to abolish the Council Tax and replace it with a Scottish Service Tax and its decision to oppose this Bill. UNISON believes:

Property is a good proxy for wealth. Unlike other forms of wealth UK homes are impossible to hide in tax shelters or foreign banks. It is an important part of the basket of taxation. A property based tax is a simple way to ensure the well off pay their fair share.
A Service Tax will move more of the burden of taxation onto those in work increasing the financial pressure on families. Many people on lower incomes have higher disposable incomes for example if they own their homes outright and have no dependants.
The claim that most people will be better off under a Service Tax assumes single earner households. Many two-earner households would in fact be worse off under the current SSP proposal. The decision about the level of any tax is a political one and is not based on what is being taxed. The same is also true about the promised yield of the Service Tax.
Inheriting property ensures inequalities are maintained. Taxing property is a therefore key to reducing inequalities in the long term.
The Service Tax proposed by the SSP will break the link between those who use and pay for public services locally and their councillors.

UNISON does not believe that that the current Council Tax is perfect.

  • Council Tax Benefit needs reform to protect low paid workers adequately
  • Current bands need reformed
  • Regular revaluation is essential
  • Business rates should be returned to local authority control.
  • Grant support should be allocated with minimum ring fencing.
  • Level playing field between local authority borrowing and private finance is essential.

Conclusion

UNISON believes that the Council Tax provides a stable yield for local councils at low administrative cost. It should be reformed to make it more progressive. The non-property-based alternatives like the Service Tax are administratively complex and easier for the wealthiest members of society to avoid. They would not make our tax system fairer. We urge MSPs to reject this Bill.

For further information contact:

Dave Watson, Scottish Organiser d.watson@unison.co.uk Tel. 07958122409

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