Local Income Tax - 'workable and efficient'

12.00.00pm GMT Mon 15th Nov 2004

Chris Coleman welcomed a recent report by CIPFA (Chartered Institute of Public Finance and Accountancy) which confirms that Local Income Tax is a practical and workable alternative of funding local government.

He said: "Liberal Democrats support local income tax because it is fairer and puts more control in the hands of local people. The CIPFA now confirm that it is both workable and much more efficient than the current system of Council Tax and central government grants".

The report, "A Taxing Issue - A Local Income Tax Exemplified", finds that average band "D" Council Tax bill could be reduced to about £600 in England, if a local income tax of 2p in the £1 was used to supplement local authority spending.

It shows that LIT can be administered by the Inland Revenue with no extra burden on employers. That means axing council tax for Local Income Tax will produce efficiency savings of around £300 million a year that could be invested in better local services.

"Our political opponents have been trying to rubbish Local Income Tax as too complex and expensive to collect. This report, from a respected, independent professional body, demonstrates that they are wrong. Again it has been the Liberal Democrats who have led the debate by proposing sensible, practical solution. It is time to axe the unfair and inefficient Council Tax" said Chris Coleman.