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Ex-bank boss turns on tax plans Ex-bank boss turns on tax plans
(2 days later)
The former governor of the Bank of Scotland has criticised the main parties' plans to reform council tax.The former governor of the Bank of Scotland has criticised the main parties' plans to reform council tax.
Sir Peter Burt also said he saw no good reason not to have a referendum on independence.Sir Peter Burt also said he saw no good reason not to have a referendum on independence.
Earlier in the week the businessman's name appeared in a newspaper advert supporting the Union.Earlier in the week the businessman's name appeared in a newspaper advert supporting the Union.
Speaking to Newsnight Scotland, he said that if there was strong enough feeling in the country a referendum would help clear the matter "once and for all".Speaking to Newsnight Scotland, he said that if there was strong enough feeling in the country a referendum would help clear the matter "once and for all".
Sir Peter also cast a critical eye on the main parties' policies for the reform of the council tax.Sir Peter also cast a critical eye on the main parties' policies for the reform of the council tax.
He identified faults with the proposals currently on the table.He identified faults with the proposals currently on the table.
Sir Peter was commissioned by the Scottish Executive to look at ways of changing the local government tax system.Sir Peter was commissioned by the Scottish Executive to look at ways of changing the local government tax system.
It would be like an obese person on a crash diet, yes, you lose weight very quickly, but it can harm you quite severely Sir Peter Burt on independenceIt would be like an obese person on a crash diet, yes, you lose weight very quickly, but it can harm you quite severely Sir Peter Burt on independence
He concluded that the current arrangement should be replaced with an annual charge based on property value.He concluded that the current arrangement should be replaced with an annual charge based on property value.
The "A Fairer Way" report said the tax should be based on about 1% of a home's valueThe "A Fairer Way" report said the tax should be based on about 1% of a home's value
However, the formula was rejected by First Minister Jack McConnell and the main parties.However, the formula was rejected by First Minister Jack McConnell and the main parties.
On Wednesday Sir Peter's name appeared on the pro-Union list, which was published in The Scotsman newspaper.On Wednesday Sir Peter's name appeared on the pro-Union list, which was published in The Scotsman newspaper.
He used the analogy of someone losing weight to explain that independence would not be healthy for Scotland.He used the analogy of someone losing weight to explain that independence would not be healthy for Scotland.
'I might be wrong''I might be wrong'
Sir Peter said: "It would be like an obese person on a crash diet, yes, you lose weight very quickly, but it can harm you quite severely.Sir Peter said: "It would be like an obese person on a crash diet, yes, you lose weight very quickly, but it can harm you quite severely.
"We would be much better being part of the Union and have the benefit of doing it as part of the UK as a whole.""We would be much better being part of the Union and have the benefit of doing it as part of the UK as a whole."
But he admitted he could see no good reason not to have a referendum "if a significant percentage of the population appeared to want it".But he admitted he could see no good reason not to have a referendum "if a significant percentage of the population appeared to want it".
He added: "I don't think there would be a majority of the electorate voting for the SNP, I might be wrong.He added: "I don't think there would be a majority of the electorate voting for the SNP, I might be wrong.
Sir Peter Burt is a backer of the Union, but not against a referendumSir Peter Burt is a backer of the Union, but not against a referendum
"But if there were a majority voting for the SNP I think the sooner we had a referendum the better, let's get this clear once and for all and out of the way.""But if there were a majority voting for the SNP I think the sooner we had a referendum the better, let's get this clear once and for all and out of the way."
Sir Peter went on to assess the council tax policies of the main parties.Sir Peter went on to assess the council tax policies of the main parties.
He said Labour's plan to reduce council tax bills by £10 for every household in band A would result in increases in bills by £500 for householders in band H.He said Labour's plan to reduce council tax bills by £10 for every household in band A would result in increases in bills by £500 for householders in band H.
Sir Peter said: "In the Middle Ages they spent a long time looking for philosopher stone to turn lead into gold, maybe Labour have found it." Sir Peter said: "In the Middle Ages they spent a long time looking for the philosopher's stone to turn lead into gold, maybe Labour have found it."
He also said that plans to discount the water and sewage elements for over 65-year-olds were not an efficient use of resources.He also said that plans to discount the water and sewage elements for over 65-year-olds were not an efficient use of resources.
"It means in another couple of years time, when I reach 65, I will get a discount on my water and sewerage charges and I don't think that that is an efficient use of resources and there are plenty of people in my circumstances."It means in another couple of years time, when I reach 65, I will get a discount on my water and sewerage charges and I don't think that that is an efficient use of resources and there are plenty of people in my circumstances.
Unearned incomeUnearned income
"They should be focusing on poorer members of society," said Sir Peter."They should be focusing on poorer members of society," said Sir Peter.
The Scottish Tories also have plans to increase the benefit and lessen the financial burden for the over-65s.The Scottish Tories also have plans to increase the benefit and lessen the financial burden for the over-65s.
Leader Annabel Goldie said a 50% discount to pensioners funded from the centre was one of the "simplest mechanisms to pursue".Leader Annabel Goldie said a 50% discount to pensioners funded from the centre was one of the "simplest mechanisms to pursue".
He added that the Lib Dems proposal, with variable rates for 32 councils, would be a "nightmare for employers".He added that the Lib Dems proposal, with variable rates for 32 councils, would be a "nightmare for employers".
Sir Peter believed that an income tax to replace the council tax would only be effective if it were to apply Scotland-wide.Sir Peter believed that an income tax to replace the council tax would only be effective if it were to apply Scotland-wide.
He went on to criticise the SNP and the Lib Dems' proposals to exclude unearned income in their plans.He went on to criticise the SNP and the Lib Dems' proposals to exclude unearned income in their plans.
"People with large savings, and who have an income off that, will not have to pay any tax at all," he said."People with large savings, and who have an income off that, will not have to pay any tax at all," he said.
"I don't think that is as fair as the council tax, you are excluding an significant proportion of the population's income, according to the figures from HMRC it is about 8% who would be excluded."I don't think that is as fair as the council tax, you are excluding an significant proportion of the population's income, according to the figures from HMRC it is about 8% who would be excluded.
"Should the richest in society not be paying tax on that?"Should the richest in society not be paying tax on that?
"It will encourage savings, I supposed it will encourage people to transfer earned income to savings so if you are running a small company it will make sense to cut your salary and pay the profits as dividend.""It will encourage savings, I supposed it will encourage people to transfer earned income to savings so if you are running a small company it will make sense to cut your salary and pay the profits as dividend."