18 September 2006
With the Liberal Democrats beginning their Party Conference this week, attention has been focused on whether or not they will vote to keep their punishing top income tax rate of 50%.

Voters in West Worcestershire may also have heard about a 2p cut in income tax and increased green taxes.

What has been less well publicised is that there is a catch to this tax cut - in fact there are a lot of catches.

First of all, the small print reveals that the Lib Dems still want to replace council tax with a local income tax. Their own internal documents estimate that the rate of local income tax would be about 4 pence in the pound. Besides, a local income tax entails all the difficulties of the Poll Tax, when it comes to determining to which council you should be paying your tax. The authorities have to know where you are all the time, while your propertystays in one place...

Secondly, they have a policy motion to "enlarge the tax base ... by further developing policies on land value taxation." Later on they mention "We believe land taxation potentially has an important part to play in a balanced overall system... There are satisfactory models elsewhere, notably Denmark where a national 1% property tax has operated for over 80 years."

In Malvern Hills District Council and in Wychavon District Council, where the average property is worth £215,000, this would mean an annual property or land tax of £2,150 in addition to a local income tax.

Thirdly, the price of petrol would be put up further and the road tax for a family cars like the Ford Mondeo with a petrol engine would pay at least £850, along with small cars like some Mini and Ford Ka models.

It gets worse if you need an off-roader in rural areas as the Midlands-built Land Rover Discovery would rise to £2,000 per year. "That's a tax that will definitely work - it will work because no-one will drive a car like that if the tax is that high. People will shift to lower tax vehicles, but that means the tax revenues won't be as high as the Lib Dems predict and lots of car production jobs in the West Midlands will be lost." said Harriett Baldwin, Conservative Parliamentary candidate for West Worcestershire. "People in our rural communities who rely on their cars will also be badly affected by the hike in petrol prices."