I’ve just finishedour response to the Scottish Parliament’s Finance Committee’s inquiry on a Scottish approach to taxation (running until the 30th September if anyone fancies submitting something themselves).

As the Scottish Parliament gets its new powers over income tax, aggregates levy and air passenger duty, it’s good to see MSPs taking a look at the overall approach to taxation, and what the principles of a Scottish model should be.

In our response, we suggest that:

  • Tax should be progressive, so that people pay what they can afford.
  • Tax should be used to encourage democratic engagement, so that all opportunities to help people connect to their democracy are used.
  • Tax should encourage community- and environmentally-friendly behaviour, so that we use tax to help us retain the best of our communities and natural landscapes.
  • Tax should be ‘done’ in a simple, transparent manner, with particular care taken for those who have changing circumstances, or whose tax payments interlink with social security. We should also make sure that the tax owed and paid by corporations is clear, and have a debate around openness of tax for individuals too.
  • We should be careful of the language we use to talk about tax, making sure that we do not stigmatise those who do not pay direct taxes; and ensuring we talk about tax as a positive contribution to society rather than a burden.

We’re not the only ones in our sector talking about tax. Oxfam Scotland is currently running a campaign on Scottish Limited Partnerships in an effort to help prevent tax dodging that takes place in Scotland. The Poverty Alliance continues to make sure we watch our language with their Stick Your labels campaign; there are obvious parallels here with the ‘tax-payer = good, so-called-scrounger = bad’ narrative that has flowed around much of the UK’s tax conversation. Meanwhile, environmental organisations share their ideas for taxes to safeguard and improve our environment for current and future generations (see, for example, this from Scottish Environment LINK, the forum for Scotland’s voluntary environment organisations).

So, it’s clear the sector has a lot to say on all taxes, not just those directly related to the operation of charities. Although on that point, it’s worth me flagging up the UK Government’s current consultation on tax digitalisation. This is the desire by the UK Government to put tax accounts online – both for businesses and individuals. This is likely to bring in change to many third sector organisations, and to donors too. The consultation documents are online so take a look and respond if it’s relevant to you.

Oh, before I go, I should let you know that we have also responded to the Local Government and Communities Committee’s call for evidence on the proposed Council Tax reforms.

Don’t forget that I’m always really interested to hear your thoughts on these issues, so drop me a line and let me know what you think: jenny.bloomfield@scvo.scot