Where do the wealthy pay more tax?

The newsnight slayer

The Department of Communities and Local Government has, under Eric Pickles, been very keen to ensure that there is a regular stream of ‘open’ data to help the public get a deeper understanding of what their politicians are up to. Indeed, his very openness made the BBCs Gavin Estler look extremely silly on Newsnight.

However, on the same day that Mr Pickles was having fun at the expense of the BBC research staff, his department also released the latest open data attempt; a map summarising how much council tax is paid in each area of the UK. The map is shown below and for those without chronic short-sight you can see a full sized version here:

The map clearly shows that those areas that are populated by wealthy people are paying more council tax.

Aha, might say those in favour of council cuts; the areas that are the most wealthy, and paying the highest council taxes, are also those that received the smallest cuts. See, I told you it was fair.

Except, that’s not what the map shows at all.

You see, whilst Eric Pickles says:

These new figures allow residents to go compare and see who really pays for local services. No one likes paying council tax, given it doubled since 1997. But the richest and most affluent areas of middle England already pay the highest council tax.

Despite the need to pay off the budget deficit, the new Government has ensured fairness for all parts of the country – north and south, rural and urban, metropolitan and shire.

The rest of the DCLG press release, almost apologetically points out the rest of the truth:

Council tax per head is primarily a reflection of property values and the distribution of central government grant. To compare the tax and spending decisions of individual councils, one should contrast the average Band D per household council tax rates of each council. This is since homes in areas with lower property values have lower council tax banding and a smaller ‘taxbase’. Band D however allows for council-by-council comparisons on councils’ individual budget decisions.

So what is the value of the map, apart from to point our the bleeding obvious; that is that people with more expensive houses pay more tax, and areas with more expensive houses bring in more council tax? It’s hardly ‘hold the front page stuff’ is it?

Maybe, it is Mr Pickles second chart that is designed to shift the public debate: (normal eyesight link here)

Again, the message is the unsurprising one that those areas that are poorest recieve the most money from central Government as part of the grant. Geez, I am shocked!

So what can we conclude from this latest outburst of open data.

1)      Data is not, nor ever will be, neutral. I’m not a great supporter of Tony Benn but he once asked (in fact knowing Tony Benn he’s probably asked it thousands of times) why it is that we discuss the FTSE every hour but don’t report the nuimnber of people on housing waiting lists or waiting for hip operations at the same frequency. What you choose to report is important. In this example I want to know whay there wasn’t a third chart showing the need of each of the areas? We know the DCLG collect the data so why no ‘heat map’?

2)      Council tax is still, even without a revaluation for the last 15 years, reasonably redistributive. The money goes from wealthy areas to areas with greater needs. This has been partially reversed by the current administrations decisions but any new system introduced for funding local authorities is going to have to acheive this.

Eric Pickles is genuinely committed to open data and ensuring that people have as much information as possible so as to make rational decisions. For his reputation’s sake he should remember that he has a responsibility to ensure that any data released is done so in a neutral way and without the bias he showed in his statements.

Explore posts in the same categories: We love the Council

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One Comment on “Where do the wealthy pay more tax?”

  1. J.G.Harston Says:

    Council tax *per* *head*??? No wonder the chart is nonsense. Sheffield with 90% paying £855 at Band A with 530,000 residents comes to £1.6/thou, Westminster with 90% paying £755 at band H with 236,000 residents comes to £3.2/thou. Wow! Rich people pay more! Yeah, I’m sure the millionaires of Westminster will find £755 a bigger pain in their pocket than the workers of Sheffield paying £855.

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