Sunday, 3 November 2013

The Tories may see Tax powers as a Trojan Horse but we still need them

The announcement  that will be given borrowing powers, control of landfill tax and stamp duty, and a House of Commons bill giving permission to hold a referendum on the devolution of control over some  income tax subject to a referendum, are welcome.
Though of course the Devil will be in the details and it does seem that Cameron and the Tories see this as a way to shift more blame for the current state of wales away from Westminster and that it can improve the Tories chances by portraying themselves as a Low Tax party and the others in the Assembly as high spending and "welfare parties".
" he announced at the Senedd in Cardiff Bay.
The Tories may see Tax powers as a Trojan Horse but we still need them
"Today is about a strong and responsible future for Wales,"Today we are announcing more power for the Welsh people and the Welsh government.
"Power that's about building this country up, power that's about making sure we have real accountable government here in Wales.

But this is no reason to reject or delay  as First Minister Carwyn James seems to be suggesting
Speaking after the  publication of the Silk Commission report, he said the Barnett Formula would have to be revised before income tax is devolved.

It’s not something I’ve sought – the view of the Government is that we wouldn’t seek powers over income tax,” he said.
“We have to make sure that if income tax is devolved in the future, the basis on which it is devolved is sound. We know Wales is underfunded by £350m a year. If we accepted income tax varying powers on that basis, it would simply lock in permanently the underfunding. Now that can’t possibly be in Wales’ best interests.
“There are a number of steps that would have to be taken. First of all, the Barnett Formula would have to be revised to arrest that underfundingOnce that’s done, of course, it might be possible to look at a referendum in the future.”

So basically that's a No

Scotland voted for tax varying powers way back in 1997 and it will be interesting to look into why they have not used these powers to the extent that a different tax regime is clearly visible in Scotland

For the record although 74.3% voted for a Scottish Parliament the number for tax varying powers was 63.5%

It would be useful if Wales were granted these powers control over our utilities was also devolved,
This could see Plaid Cymru leader Leanne Wood plans to set up a new body to drive down energy bills in Wales. where "Energy Wales would buy gas and electricity at wholesale prices and sell directly to homes and businesses.and the surplus be split between protecting customers and expanding energy efficiency.

We need these tax varying powers even if the Tories see it as a Trojan Horse. But we need a Welsh Government with vision and enthusiasm to use this for the benefit of the whole of Wales.

One thing is sure under Labour in the Bay sleepy Government we have neither . We will need a change in Cardiff bay at the same time we obtain some control of the purse strings.

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