Clegg clears way for Liberal Democrats to do deal with SNP on local income tax

Published on Thursday 4 September 2008 22:11

NICK Clegg, the Liberal Democrat leader, yesterday gave his blessing to a deal with the SNP that could mean local income tax being introduced in Scotland.

He said he wanted the party north of the Border to come to an agreement with the Scottish Government because he hoped a local income tax would be introduced and the council tax abolished.

Alex Salmond, the First Minister, announced earlier this week that he was going to push ahead with plans to introduce a local income tax, set centrally at 3p in the pound, and a bill would be published in the next parliamentary session.

The Liberal Democrats also want a local income tax, but they want it to be levied by individual councils, not set by the Scottish Government.

Neither side has yet agreed to compromise on this central issue, but Mr Clegg gave a clear hint that he believed the SNP might drop its insistence on a nationally set rate.

Mr Clegg said the Nationalists' "formal" policy, set by the party at previous conferences, was for local discretion and he said he hoped they would move back to that.

He said: "Where, of course, we presently differ from the SNP is that, while the SNP's formal policy is still that it should be a genuine local tax, namely one that can be varied by communities locally, their present proposal is, of course, much more rigid than that – it is actually a set rate.

"That is precisely the issue on which we want to persuade the SNP to go back to their better instincts, so that we are once again in line with each other."

Labour suggested yesterday that a "backroom deal" was in the offing. Cathy Jamieson, Scottish Labour's acting leader, challenged Nicola Sturgeon, standing in for Mr Salmond at First Minister's Questions, to give an "absolute guarantee" that Scotland would not have 32 different tax rates – one for each council.

Ms Sturgeon did not give a direct answer but later said: "The SNP looks forward to having very constructive discussions with our friends in the Liberal Democrats under the new broom of Tavish Scott."