View from the street: Collection of regressive tax is deeply unfair to poor
PUBLISHED: 08:00 21 January 2018
On Monday January 15, the BBC featured the enforcement of council tax in its Inside Out London programme.
The pain of council tax enforcement was well described, but the injustice of local authorities taxing the lowest incomes was more implied than explicit.
We were shown how the councils send out the bailiffs, who add extortionate fees to the council tax arrears of the most vulnerable residents, and how one bailiff understood that some households simply do not have the money to pay the tax. We were given a powerful explanation by lawyer Alan Murdie about how the councils make people homeless by putting a charging order on their homes to pay the tax while adding exorbitant legal costs.
Concern was expressed by Mr Murdie at the behaviour of some of the debt enforcement agencies to whom councils are feeding their council tax debtors. A victim living under the cosh of harsh enforcement of the unfair council tax described his suicidal feelings.
But the BBC did not cover the injustice of local authorities taxing the lowest benefit incomes of tenants, and extracting the tax with charging orders on the homes of ageing low-income couples thus making them homeless. Meanwhile the wealthy are parking their incomes tax free in overseas havens and making billions of unearned wealth as the value of their land increases. The council tax is deeply regressive. The wealthy are paying proportionately so little that the poorest residents are made to fund the local authorities with council tax from seriously inadequate benefit incomes which are exempt from income tax.
The government cut the central funding for council tax benefit by 10 per cent in 2013.
Local authorities then made the poorest cover the shortfall by taxing working age benefits which have been shredded by national government by £18 billion since 2010. The local authorities did not ask the better off to pay anything towards the shortfall. It will be worse this year because benefits are being cut by another £12billion by 2020.
£73.10 a week Job Seeker’s Allowance is the cornerstone of the benefit system; all other unemployment benefits are added to it. It equals £317 a month under the Universal Credit (UC) and is paid to over 3.9 million people in the UK.
£73.10 a week is incapable of providing a healthy diet and other necessities for anyone, but in particular for a woman before and during the development of a child in her womb.
It is taxed by local authorities despite the fact that it has been losing value since 1979.
The councils have a Health and Wellbeing Board which takes the lead in promoting a healthier local population. The board has gone to sleep in Haringey. It allows the council to tax benefits shredded by National government, to make residents homeless to pay the tax and to demolish the homes of council tenants with the HDV without considering the impact on their health.
Under the Health and Social Services Act 2012, councils are required to improve the health of their local population. But they are making it worse.