Meeting of the Parliament 19 February 2015
I am pleased that the bill has got to stage 3 and that it has the widespread support that it obviously has. The community charge was a bad tax, and my colleague Kenny MacAskill put that eloquently, as others will.
In the first place, it is not just any old debt that is being written off. There is a much stronger argument for writing off the poll tax debt than for writing off the debt for any other run-of-the-mill tax, because the poll tax was so unfair all along the line. However, the reality is that all debt needs to be evaluated at times. We must evaluate, for example, whether it can be collected at all, whether the cost of collecting it makes it worth while and whether chasing it is detrimental to other objectives.
I suggest that, on all three of those points, the tax write-off that the bill proposes passes the test. First, it is clear that the vast bulk of the debt cannot be collected, as people do not have the money, have died or are not traceable. Secondly, some councils have already decided that it would be throwing good money after bad to pursue the debt and have stopped trying to collect it. Thirdly, councils such as Glasgow City Council have decided to pursue council tax debt rather than diverting limited resources to the poll tax debt.
We should not think that writing off debt is unusual. Private and public sector debt is first provided for if there is doubt about its collectability. That often occurs by providing 25 per cent, 50 per cent and so on as the debt gets older without being collected. Once any debt has been provided for 100 per cent, it can still sit in the accounts but the net effect is nil, as the provision matches the asset. In effect, that is what has already happened with community charge debt, as I understand that all councils have provided 100 per cent of the outstanding debt. Therefore, writing it off merely reflects the reality that the debt is, to all intents and purposes, irrecoverable.
It is also not unusual that those who pay tax—or any cost, for that matter—cross-subsidise others who do not or cannot pay it. Anything that we buy in the shop includes the cost of shoplifting and, when we pay for gas or electricity, the payment includes the cost of those who default. The Conservatives may try and make a big song and dance out of the situation, but we are doing only what any business or utility—or whatever—does pretty regularly.
As has been mentioned, there is a tax gap. We gather that that is £34 billion for the UK. If we were starting off from scratch to close the gap, would we look for the few pounds here or there that we could get from people who were struggling or would we chase the big multinational companies that avoid tax through dodgy transfer pricing and the rich individuals who can afford clever tax experts and who move large parts of their assets to offshore tax havens?
There is a moral question here. Are we pursuing unpaid tax from the rich and powerful with the same enthusiasm as we are pursuing it from the poorer and the weaker? The SNP, Labour, the Greens and the independents are pretty clear on that point, but I fear that the Conservatives tend to side with the rich and powerful against the weaker and poorer. I have no idea where the Liberal Democrats are on the issue.
I am more than happy to support the bill and I am delighted that it has reached stage 3. It is not just about a few thousand pounds or even a few hundred thousand pounds. We are sending out a symbolic message that this Parliament does not approve of taxes such as the poll tax, that it will not introduce taxes like the poll tax and that it will do what it can to make our society fairer and help those most in need.
I congratulate the Government on introducing the bill. I look forward to it being passed today.
16:41