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EDITIONS
Monday, 19 August, 2002, 13:49 GMT 14:49 UK
Socialists reveal tax plans
Tommy Sheridan
Tommy Sheridan is the party's only MSP at present
Proposals to replace council tax with an earnings related tax have been unveiled by the Scottish Socialist Party (SSP).

The Scottish service tax would be an income-based levy which would increase the top rate of tax for high earners from the current 40% to 60%.

At the top of the scale, earnings over 90,000 a year would be taxed at an additional 20%, while incomes below 10,000 would be tax exempt.

Party leader Tommy Sheridan said the change would leave 16% of Scottish households worse off but lessen the tax burden almost 78%.

The policy is set to be a major theme for the party during the election campaign for the Scottish Parliament in May next year.

SSP local tax plans
All income under 10,000 would be exempt
Income between 11,000 and 29,999 would be taxed at 4.5%
Income between 30,000 and 50,000 would be taxed at 15%
Income between 50,000 and 90,000 would be taxed at 18%
All income over 90,000 would be taxed at 20%

Mr Sheridan claimed that under the present system, Stagecoach founder Ann Gloag, Scotland's richest woman, who lives in the 24-bedroom Beaufort Castle in Inverness-shire, pays 1,878 in council tax.

"Helena Duffy, a lone parent who earns 170 a week as an ancillary worker in Stobhill Hospital, pays 760 in council tax for a two-bedroomed 14th floor high-rise flat in Milton, Glasgow," he said.

"In effect, Ann Gloag pays less than two and a half times more than Helena Duffy, even though she earns at last 100 times more."

The list MSP for Glasgow admitted that the policy would leave 16% of Scottish households worse off but said that 77.7% would benefit with about 6.3% experiencing no change.

The aim, he said, is to put "20 to 25 a week extra into the pockets of the low paid and pensioner households".

Devolution policy

Under the proposals, there would still be an additional council tax charge for second homes but the scheme would not replace the main income tax.

Mr Sheridan said the policy could be introduced under devolution.

But he also admitted that it could result in Westminster "clawing back" up to 250m which is currently paid to Scots through the benefits system.

SSP Poster
The SSP is hoping to see its support increase
The Scottish Socialist leader rejected claims that higher taxation of more affluent people would lead to many leaving the country.

He said only "1% or 2%" would actually move as most people's jobs depended on them actually living in Scotland.

Full details of the new policy were formally announced at the City Chambers in Glasgow on Monday.

The party plans to hold a second briefing next week to set out its other big election issues, including water charges.

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 ON THIS STORY
Tommy Sheridan
"It would replace the current system with an earnings related tax"
See also:

20 Jun 02 | Scotland
23 Mar 02 | Scotland
04 Mar 02 | Scotland
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