25 reasons why Alex should drop local income tax

Local income tax (LIT) will leave a 750 million financial black hole in Scotland. Others have suggested it could be as high as 1.3 billion.

YVETTE COOPER, CHIEF SECRETARY TO THE TREASURY

LIT will make Scotland the highest-taxed part of the UK and this might encourage businesses to leave.

INSTITUTE OF DIRECTORS

There will be serious service cuts at council level unless local income tax is set at 4.5p or higher.

THE LABOUR PARTY

LIT may be illegal under the provisions of the Scotland Act because it is unclear whether a local tax can be replaced by a national tax.

PROFESSOR RICHARD KERLEY, OF QUEEN MARGARET UNIVERSITY

Replacing an unfair tax with an unworkable tax will cause more misery than we can know.

PATRICK HARVIE, GREEN PARTY

There will be a 'damaging' impact on service personnel, who would have to pay the new tax in full, but currently have their council tax reduced. This could lower morale and cause yet more recruitment problems.

BOB AINSWORTH, ARMED FORCES MINISTER

There will be serious anomalies over people living in England but working in Scotland. There are also concerns that people may register as living in England to avoid paying.

THE INSTITUTE OF CHARTERED ACCOUNTANTS

Hard-pressed students, who are currently exempt from the council tax, would have to pay.

THE NATIONAL UNION OF STUDENTS

Scottish firms would be placed at a competitive disadvantage to companies in other parts of the UK because LIT additions to wage packets would be passed on to customers.

SCOTTISH CHAMBERS OF COMMERCE

LIT will take 70 million from vital city council services which will lead to severe cuts.

GLASGOW CITY COUNCIL

The PAYE system does not easily deal with taxpayers who receive income from different sources, including pensioners receiving pensions from different employers or those who have various part-time jobs – this will particularly affect those on low incomes who will be exposed to incorrect PAYE codes, and these practical issues should not be underestimated.

THE LAW SOCIETY OF SCOTLAND

Regardless of the rate of tax chosen, there will be uncertainty as to the yield that can be obtained, as revenues derived from income taxes can be more volatile.

SCOTTISH COUNCIL FOR DEVELOPMENT AND INDUSTRY

LIT would be technically complex and challenging to implement because of the complexities of tax law, and trying to sort out what would happen to the 400 million council tax benefit.

THE CHARTERED INSTITUTE OF PUBLIC FINANCE AND ACCOUNTANCY

Investors and businesses who are thinking of coming to Scotland will be scared away because of the extra income tax.

CBI SCOTLAND

LIT probably breaks European law by removing control of raising local finances from councils. It could break Article 9 of the European charter of local self-government, which guarantees the right of councils to raise a large part of their own finances.

PROFESSOR CHRIS HIMSWORTH, OF EDINBURGH UNIVERSITY

Wealthy people who have unearned income from sources like share dividends can avoid LIT whilst poorer people would have to pay.

THE SCOTTISH TRADES UNION CONGRESS

The UK tax system does not give across-the-board allowances for disability and, in the absence of such allowances, the burden of LIT will be higher on disabled people than on the general body of taxpayers.

LOW INCOMES TAX REFORM GROUP

LIT will be more intrusive into people's lives because it would require far greater knowledge of their personal circumstances than a property tax would.

THE INSTITUTE OF REVENUES, RATING AND VALUATION

At present, a cohort of carers are currently "disregarded" (treated as not living in the property) when calculating council tax. Households with multiple taxpayers will end up paying more and this has the potential to include more carers who are not currently liable for council tax.

CARERS SCOTLAND

The 281 million of savings that need to be made to create a 3p local income tax could be used instead to reduce the burden of the council tax.

THE CONSERVATIVE PARTY

LIT would bring unwelcome extra bureaucracy and cost to businesses because of all the extra paperwork created in sorting out employees' income tax. Lib Dem proposals for different rates for different areas would make it even worse.

THE FEDERATION OF SMALL BUSINESSES

Families will be worse off, or there will be cuts in public services, because the 3p rate will not be enough to fund current service levels.

UNISON

Water and sewerage charges are collected by local authorities on behalf of Scottish Water – the consultation did not present any proposals on how such charges will be set and collected under LIT.

SOCIETY OF LOCAL AUTHORITY CHIEF EXECUTIVES

LIT would be bad for the environment because it will take away the flexibility needed to bring in specific charges for rubbish collection.

THE POLICY INSTITUTE

The SNP's centralising LIT proposal reduces the lack of control that councils have over local finances.

SOUTH LANARKSHIRE COUNCIL

SALMOND'S VISION: MORE COVERAGE

• Defiant Salmond ignores barrage of flak over tax

• Every bill and what it means for you

• Analysis: LIT could be the biggest gamble yet

• Alex Salmond: My plans for a safer, stronger, greener, wealthier Scotland

• Leader: Reach consensus before ditching council tax