The Times Online reports that David Hartnett, head of Revenue and Customs, is to write to Scotland’s top civil servant saying that there is no legal basis for a local tax and that the Revenue would refuse to collect it.
The letter to Sir John Elvidge, Permanent Secretary at the Scottish Government, will apparently state:
“[T]here is no legal basis for a local income tax along the lines outlined in the SNP consultation document.”
“Your proposal for a tax where the rate was set by the Executive and the proposed tax was collected and administered by HMRC is a reserved matter under The Scotland Act 1998, and therefore a matter for the UK Government.”
“HMRC does not have the power to collect or administer a local income tax: its role in relation to the devolved administration is confined to administering the Scottish Variable Rate,”
According to The Times, the letter puts pressure on SNP ministers to concede to demands by the Scottish Liberal Democrats to allow all 32 local authorities to set their own local rate.
A spokesperson for the Scottish Government
is quoted as saying: “It’s still arrant nonsense. Scrapping the unfair council tax and introducing a fair local income tax based on ability to pay is a matter for the Scottish Parliament to determine not for the Treasury to dictate from London. This latest intervention is constitutionally confused and politically inept. The Scottish Government and Parliament is not a Whitehall department which can be bullied by the Treasury. We represent a country, and we have every right and ability to scrap the council tax and replace it with a local income tax.”
It may be illegal, but we should probably just press on ahead regardless, eh?