Nick Clegg is the Liberal Democrat parliamentary candidate for Sheffield Hallam. He is writing a campaign diary for us until the election. Today, he sets out with trepidation to explain the Lib Dems' local income tax policy, but finds the electorate reassuringly receptive.
"Elections are too often about trading slogans on issues and policies with which the electorate is already wearily familiar. So it's been fun this week to explain a novel, bold policy to an electorate bored by the relentless, random scaremongering of Michael Howard."
Nick Clegg writes:
"Tax. No other subject is of such enduring fascination at election time. Other issues wax and wane. Europe one year, hospitals the next. Crime one election, schools the next. But tax is constant.
"Most politicians say the same thing about tax – the other lot will cost you more than we will. Most of the time they promise something for nothing – lots of glittering blandishments are waved at the electorate, all for no extra pain in tax. No wonder almost every government in living memory – both Labour and Conservative - has broken its promises to the electorate on tax. Chancellors of the Exchequer – Ken Clarke and Gordon Brown are only the most recent culprits – have been surreptitiously fleecing taxpayers for years while pretending that nothing has changed. Stealth taxes are not new.
"So it was with some trepidation that I prepared to explain the Lib Dem's radical proposal to replace the pernicious council tax with a local income tax. Any change to the tax system can sound scary, and my Conservative opponent has been busily scaremongering on the issue (creatively transforming our proposal for one new higher rate of income tax for 1% of UK taxpayers into a breathless claim that Lib Dems will introduce 'up to 40 new taxes').
"Yet this week I have been pleasantly surprised by the reaction on the doorstep. I've even met some voters who are so persuaded of the merit of a local tax based on ability to pay rather than on the value of your home, that they are voting for the Lib Dems for the first time.
"It's also easier to explain than I had feared. First, it's simply fairer. Why should people on low incomes be hammered by a tax merely because of the type of house they occupy? Second, it avoids the council tax bombshell which is going to hit every taxpayer hard in 2007 when properties will be 'rebanded'. This bombshell, supported by both Labour and the Tories, is going to be particularly unwelcome in a place like Sheffield Hallam where property prices have been increasing sharply in recent years. Third, the local income tax will be a much smaller component in the overall tax take, £2.3bn less than the present revenue raised from council tax, and will be a fraction of an individual's total tax contribution.
"The fact that it's widespread in the USA, Japan and large parts of Europe, saves about £300m per year by cutting all the bureaucracy involved in collecting the council tax, and would leave around 75% of all taxpayers paying the same or less than they do now, only strengthens the case.
"Elections are too often about trading slogans on issues and policies with which the electorate is already wearily familiar. So it's been fun this week to explain a novel, bold policy to an electorate bored by the relentless, random scaremongering of Michael Howard. What's more, they seem to like what they hear."
