The Confederation of British Industry (CBI) has come out against Labour proposals for an increase in the council tax.
The business group have backed Scottish Ministers who confirmed their plan to maintain the freeze in the face of calls from the leader of Labour run Glasgow Council, Gordon Matheson, for the policy be ditched.
The Confederation of British Industry (CBI) has come out against Labour proposals for an increase in the council tax.
The business group have backed Scottish Ministers who confirmed their plan to maintain the freeze in the face of calls from the leader of Labour run Glasgow Council, Gordon Matheson, for the policy be ditched.
The CBI have claimed that the freeze, introduced natiowide by the SNP government, has introduced fairness across Scotland’s 32 local authorities. CBI Scotland director Iain McMillan has urged politicians to “think carefully” about plans to increase the tax.
In Scotland council tax bills had increased by 47% in 10 years against a rise in inflation of only 32% for the same period.
Mr McMillan said:
“It is hardly surprising that there was growing resentment against the high level of this tax in the previous decade, particularly when the money flowing to Scotland from Westminster was rising significantly.
“Even after the current three-year freeze, the 13-year increase in council tax of 47% still compares unfavourably with a lower 37% increase in RPI. We support the Scottish Government’s council tax freeze. The journey towards the return to a fairer and more acceptable level of council tax must be continued.
“If not, calls for an even worse local income tax will become loud once again and Scotland’s ambition to be an attractive place in which to live, work and do business will be put at risk.”
Earlier this month, Mr Matheson told Finance Secretary John Swinney that council tax rises were needed in order to offset “brutal” cuts. Westminster plans to cut the Scottish grant will hit public finance and has already prompted concern that councils could suffer if the NHS is spared.
Labour group leader Iain Gray has backed calls to end the freeze but critics have argued that those on the lowest incomes will be hit hardest by increases to what they say is an unfair tax.
Mr MacMillan has claimed that any increase to the council tax will cause resentment but believes that the SNP’s favoured option of a Local Income Tax, which is based on ability to pay, would be worse.