Thursday, 9 April 2015

I didn't realise that "in your face taxes" was a widely used term.

I pinged off my submission to The [Scottish] Commission on Local Tax Reform, which they have put online here.

Out of interest, I read the first submission by Kenneth McKay, which merrily demolishes The Poor Widow Bogey thusly:

14... Arguments against Domestic Rates and property-based taxation in general have included that tax liability should be based on income rather than the value of property occupied and the classic comparison between a widow living alone with 4 adults living next door which brought us the Poll Tax. There are in fact very few households consisting of 4 adults!

15. Although there is not a direct link between house values and income there is reasonable correlation...

But what cheered me up most was his description of Council Tax, Domestic Rates etc. as "in your face" tax in para 12.

I always assumed that we on this blog had coined this term, perhaps not after all.


Kj said...

That's a fair bit of serious work that submission. Well done mr Wadsworth.

Mark Wadsworth said...

Kj, thanks, it was about four days work.

After years of blogging, I can hear these voices saying "Yes, but have you thought about [something]" and so you then go back and include an explanation of [something].

Bayard said...

If you look at Google, it's definitely out there as a term, e.g.

Hasn't this blog also invented the concept of Homeownerism, too?

Mark Wadsworth said...

B, perhaps, there's nothing new under the sun. And

a) I didn't invent Home-Owner-Ism, Thatcher did.

b) DBC was using the term before I was.

Ben Jamin' said...

So, basically, keep CT as is, but tweak the local grant funding formula as per your graphs. Simples.

I think it's outstanding, and clearly a sensible step forward.

The LVT purists might not understand the economics underpinning it, but hey.

You should perhaps do something similar for England. (with CGT, IHT, IPT chucked in too).

Send it to the next Chancellor.

Steven_L said...

Nice one. Is it legal for Scotland to do this?

Mark Wadsworth said...

Bj, thanks. The thing about LVT purists is that they don't realise that the rough approximation is as good as, and in some ways better, than the hyper-scientific.

SL, yes of course. Certain taxing powers are entirely under their control.

mombers said...

Mark, great submission!
Page 8 though:
"This will also save the costs of administering the LBTT and a separate Scottish income tax system. These are probably not very expensive to administer, but not having these costs at all would still be a real cost saving."
I reckon the Scottish income tax would be a nightmare to administer both for the gvmt and businesses. Payroll would now be three part: national income tax, NI and local income tax. Not to mention the avoidance and evasion...
Any links to proposals for how a local income tax would work and cost estimates?

Bayard said...

"perhaps, there's nothing new under the sun"

I was thinking more that the term had spread via Google from this blog as far as Canada.

Mark Wadsworth said...

M, Scottish 10% income tax is no big deal. Basically what will happen is that HMRC will collect 20% (or 40% or 45%) in the normal way and the Scottish govt gets its share. It will be a faff but not a huge faff.

As to LIT, bleurgh, that really would be an administrative nightmare - for a start, do you pay the relevant rate where you work or where you live?

B, yes, Derek uses it.

mombers said...

Mark, wouldn't it be 30%, 50% and 55%? Or is the local democracy destroying Barnet formula grant reduced and replaced by pretty much exactly the same thing?

Dick Puddlecote said...

Very impressive submission, MW! I do like the idea of accountability of authorities on price and services, though I expect councillors would be battling officers up and down Scotland as the former chase votes and the latter protect their kingdoms. ;)

ThomasBHall said...

Excellent response Mark. I know I have mentioned the idea before, but I really think we (i.e YPP, the readership of this blog etc.) should package up our thinking into some sort of reasearch group/ think tank/ lobby group.
I can almost guarantee that your excellent submission will be skimmed at best, and mainly because it is written in a fairly casual style, and has no header/ professional presentation and is clearly from a "lay" individual- even if that "lay" individual is more clued up than all of the people meant to read it or decide on the tax reform outcome.
I was thinking of some sort of angle on representing the business part of business, rather than the combined business/landlord elements of businesses. Target known tenanting business, and highlight how they are different to owner occupyer businesses even in the same industry etc. Anyway- lets discuss in the pub later.

Shiney said...


I own and run a small(ish) business.

We are a tenant
We employ people
We are in manufacturing

So we face the complexities of govt (tax) policy all the time (Ers NI, rent, UBR, Corp Tax, Min wage etc etc).

Need stats?/Case Study? - I may be able to help.