Tax must be based on an ability to pay
John Clark writes…
First published: December 2004 – Gazette & Herald
Why does the Council Tax need to be reduced? It is an unfair tax. It penalises those on low incomes. Over the years the Council Tax in Ryedale has increased by well above the rate of inflation. Incomes have not risen by a proportional amount. The state Retirement Pension has risen even less. In Ryedale there is a large number of people who are retired or on a minimum wage. This of course makes the problem worse.
On the other hand we need local taxation. Money is needed for Education, Roads, Social Services, Police, Rubbish Collection, Recycling and many others. Council Tax is related to property values and not the ability to pay. Ability to pay must be taken into account in any future system of local taxation; probably a Property Tax but related to income. The impact of ever increasing Council Tax is shown by looking at three groups of people. If someone is earning £50,000 plus the Council Tax is paid for by lunchtime on the first working day of the month. For those on the minimum wage it takes until midday in the middle of the first week to earn enough to pay off that months Council Tax. It is even more painful for a couple on the state retirement pension. They need the whole of the money from the first week in the month to pay off the Council Tax for that month.
The Liberal call for a 5% reduction in Ryedale District Council Council Tax is met with the riposte that it would only reduce the Council Tax by 15p/week. True 15p does not appear to be much but let’s follow it through. 15p from RDC would be added to the 15p from the Police Authority. The same 5% from North Yorkshire County Council would amount to a further 80p. All producing a total of £1.10 per week. Again, not much. Oh yes it is! £1.10 is almost a third of this year’s pension increase of £3.45. If a pension goes up by such a small amount then 15p is a lot. Equally if the £1.10 is more than a quarter of the pension increase then the Council Tax is taking from the second week of the pension money.
The second ‘reason’ given for opposing the Liberal 5% reduction is: Where are we going to make the cuts/savings? Are we going to cut teachers, roads, social services etc? No! No! and No! On RDC we have proposed the following areas for reductions
The tourist budget £350,000 – 11% of the budget.
Additional Grass Cutting £100,000 – 3% of the budget
There should also be an end to all the ‘perks’
- ‘Chairman’s’ chauffeur driven limo
- Drinks after Full Council Meetings
- The Civic Dinner
If our fellow councillors had started on these reductions last year the changes would have been easier.
As for the County Council and the Police Authority we are asking them to look at their budgets. Can they reduce their budget by 5%? There must be savings – money on painting Library Vans a different colour; wasted salt at the roadside; campaigning to be the only council in North Yorkshire are all contenders.
If the County Council and the Police Authority cannot (not will not) reduce the Council Tax by 5% then there must be a campaign. Not a campaign within Ryedale but a campaign by Ryedale. North Yorkshire County Council, the Police Authority and Ryedale District Council must work together to bang on the government’s door. If a 5% reduction cannot be achieved then more spending is urgently required by Central Government. It is needed for the following solutions:
Increase the level of the basic state pension
Increase the minimum wage above £6/hour
OR If not both of these two:
Sufficient extra money should be put into the Local Authorities so that Council Tax can be cut by 5%.
These solutions may not fall into place in time for Christmas. If that is the case, one New Years Resolution could be to make them happen in 2005.
A Merry Christmas and a Happy New Year to all the readers of the Gazette and Herald, especially those who read Ryeviews on a regular basis.