14 December 2015

The present Council Tax system must end, with any replacement designed to be fairer, more progressive and locally empowering.
Those were among the conclusions of the cross-party Commission on Local Tax Reform – established jointly by the Scottish Government and Convention of Scottish Local Authorities (COSLA) – as it today published its final report, Just Change: A New Approach to Local Taxation.

The Commission highlights that its very membership -encompassing four political parties, local and central government, and experts in public finance, law, housing, welfare and equalities is a unique and bold statement of intent, creating “an opportunity not to be missed”.

The Commission does not advocate any single alternative to the present system, highlighting that “There is no one ideal local tax”. In making the case for change, the Commission’s report shows that local taxation can be fairer and more progressive.

They examined three alternative types of tax system that could be applied at the local level to replace the present Council Tax – taxes on property, taxes on land and taxes on income. Their analysis extends to the potential impact of each on different households and how the tax might be administered. They also considered the impacts each would have on the financial accountability of Local Government, concluding that “A well-designed local tax system drawing revenue from multiple sources would provide more options for local democracy, delivering greater financial accountability and autonomy to Local Government.”

They expect their report to inform the development of alternative local taxation policies which will be put to the electorate in the Scottish Parliamentary election in May 2016, recognising that political parties will attach different weights to the considerations for each alternative local tax.

The report does not set out tax rates or recommend levels of taxation.

Watch a short video of our launch event.

Welcoming the report, Marco Biagi MSP, Minister for Local Government and Community Empowerment and Co-Chair of the Commission said: “In publishing our report today, we put to the Scottish people the most comprehensive quantitative analysis ever undertaken to understand the links between different forms of local taxation, backed by an extensive programme of public engagement.

“From the outset – having agreed that the present system is unfair and in need of reform – we have worked together in a spirit of consensus to understand the alternatives available to us and to put to the people of Scotland a report that clearly sets out the steps that can be taken to deliver change.

“It is now up to politicians from across the political spectrum, to take today’s report and to use it to put to the Scottish people alternatives that are fair, workable and empowering for local communities.”

Councillor David O’Neill, President of COSLA and Co-Chair of the Commission added: “We have conducted more in-depth analysis of potential alternatives to the present system of Council Tax than ever before, with the aim of promoting understanding and stimulating debate among the public and politicians on the future of local taxation.

“As a result of our work, there is now a real prospect that Scotland’s politicians are on the cusp of delivering lasting and meaningful reform.

“The opportunity to deliver lasting reform is one that must not be missed.”  

The Commission’s extensive programme of public engagement included an open access survey receiving c.4,500 responses; 12 oral evidence sessions with 58 expert witnesses; a call for written evidence receiving 203 responses, including from 79 organisations and 12 professionally facilitated public listening events across Scotland.

The Commission also published research to understand overseas experiences and engaged with experts from Denmark, the Basque Country, the Republic of Ireland, and learned from the experiences of recent reform in Wales and Northern Ireland.



Notes to editors:

A copy of the Commission’s report, ‘Just Change: A New Approach to Local Taxation’ can be downloaded from its website – www.localtaxcommission.scot

Members of the Commission are:

  • Councillor Susan Aitken, SNP Local Government Convenor and Leader of SNP Group, Glasgow City Council
  • Jackie Baillie MSP, Shadow Cabinet Secretary for the Finance, Constitution and Economy;
  • Councillor Catriona Bhatia, Leader of Liberal Democrat Group and Deputy Leader, Scottish Borders Council;
  • Marco Biagi MSP, Minister for Local Government and Community Empowerment (Co-Chair);
  • Councillor Angus Campbell, Leader of Comhairle nan Eilean Siar and Leader of the Independent Group at COSLA;
  • Councillor Rhondda Geekie, Leader Of East Dunbartonshire Council and Leader of Labour Group at COSLA;
  • Dr Angela O’Hagan, Lecturer in Social and Public Policy at Glasgow Caledonian University and Convenor of the Scottish Women’s Budget Group;
  • Isobel d’Inverno, Convenor of the Tax Committee of the Law Society of Scotland and Director of Corporate Tax at Brodies LLP;
  • Mary Kinninmonth, Trustee, Scottish Association of Citizens Advice Bureaux(Citizens Advice Scotland), Chair of Citizens Advice Scotland Policy Forum Citizens Advice Scotland Board of Directors;
  • Dr Jim McCormick, Scotland Advisor, Joseph Rowntree Foundation;
  • Councillor David O’Neill, President of COSLA (Co-Chair);
  • Don Peebles, Head of CIPFA Scotland;
  • Andy Wightman, Writer and Researcher, representing the Scottish Green Party.

The Commission’s Remit is:

To identify and examine alternatives that would deliver a fairer system of local taxation to support the funding of services delivered by local government. In doing so, the Commission will consider:

  • The impacts on individuals, households and inequalities in income and wealth;
  • The wider macro-economic, demographic and fiscal impacts, including housing market and land use;
  • The administrative and collection arrangements that apply, including the costs of transition and subsequent operation;
  • Potential timetables for transition, with due regard to the 2017 Local Government elections;
  • The impacts on supporting local democracy, including on the financial accountability and autonomy of Local Government;
  • The revenue raising capacity of the alternatives at both local authority and national levels.

In conducting its work, the Commission will engage with communities across Scotland to assess public perceptions of the emerging findings and to reflect this evidence in its final analysis and recommendations.