From: jim@cs.strath.ac.uk (Jim Reid)
Newsgroups: soc.culture.british
Subject: Re: The Poll Tax (was Re: Democracy and the law)
Date: 22 Jan 93 13:22:03 GMT
	<1993Jan20.133634.18857@osf.org>
Organization: Comp. Sci. Dept., Strathclyde Univ., Glasgow, Scotland.
In-reply-to: david@postman.gr.osf.org's message of 20 Jan 93 13:36:34 GMT
Originator: jim@bain.cs.strath.ac.uk

In article <1993Jan20.133634.18857@osf.org> david@postman.gr.osf.org (David George) writes:

   In article <JIM.93Jan20111537@hunter.cs.strath.ac.uk>, jim@cs.strath.ac.uk (Jim Reid) writes:
   |> Wrong. Scotland had two rates revaluations which pushed up everyone's
   |> bills because of the rocketing inflation in house prices.

   There is zero logic in this statement Jim.  Rates only rise if the
   local council is spending more money.  Revaluations will mean some
   people pay higher rates, some lower.  If the rateably value of all
   property is increased than the general rate will be lower (% levied on
   rateable value) and the money raised will be same.  This is common
   question on '0' level (grade) maths papers.

What I said was a simplification because I didn't want to get
diverted into a detailed explanation of the mechanics of local
government finance under the old rating system. Oh well.

   If rates went up across the board it is for a number of reasons:

	   1) general inflation
	   2) the council is providing more services
	   3) the rates were previously too low, the council was borrowing
	   4) the rate support grant is being reduced - presumably to finance
		   ii) higher govt. spending (under Labour)
		   iii) tax cuts (under the Conservatives)

Up to a point. What happened was that there were two revaluations in
Scotland which dramatically increased the rateable value of property.
(As we all know, this was based on the notional rental value of your
home, which, indirectly, was dramatically increased by the inflation
in house prices in the 70's and 80's and by the abolition of rent
controls by the Thatcher government.) The highest increases tended to
be in areas which usually voted Conservative. The protests from these
Tory supporters naturally got the attention of Tory MPs who then
lobbied for rates reforms which led to the Poll Tax.

Councils did not cut their rate charges when rateable values rose for
a number of reasons. The main one was to minimise the impact of the
squeeze on their finances. This was caused by inflation, but mainly by
central government cutting the rate support grant and introducing
rate-capping. Rate-capping means that the government decides how much
local government may spend and, if they exceed that amount, the
difference is deducted from the rate support grant. (i.e. A #1M
overspend would lose a council #1M from government - a #2M shortfall
in revenue.) The introduction of the government-set business rate also
didn't help.

Local authorities had/have little control over their own affairs.
Their main source of income - rate support grant - was controlled by
the government and being reduced. Business rates were also controlled
by central government. (BTW these were cut in the hope that this would
"help businesses".) This left domestic rates as the only significant
way a council could raise revenue. Hence, domestic rates increased and
the howls from those worst affected - Conservative supporters - gave
rise to the Poll Tax as the Thatcher government decided to "do
something about the rates".

Lothian Regional Council was the only in Scotland to deliberately
overspend and improve services (like heavily subsidising public
transport). Not surprisingly, they were heavily penalised by the
government and LRC's domestic rates bills had the biggest increases.

	   5) some councillor is bunging all the road laying contracts out to
	      his brother, who charges twice as much because he has to pay
	      backhanders.

Ahhh, now you're talking about Monklands District Council... :-)


   |> It was also unfair as a
   |> flat-rate tax did not take account of people's ability to pay.

   It was a two tier tax.  Levied at either 20% or 100% depending on
   ability to pay (means tested).

Not really. An 18-year old working for 80 quid a week paid the full
whack, just like say a cabinet minister earning 1600 quid a week.
The discounts which were introduced didn't go far enough and had lots
of anomalies. It also does not detract from the blatant unfairness of
the tax: it's not unreasonable to expect a fair tax to levy approx. N
times more (less) on someone who earns or is worth N times more (less)
than me. The Poll Tax didn't do this.

		Jim