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UK Gov't Paper Released On English Tax Powers

by Robert Lee,, London

18 December 2014

The UK Government has published a Command Paper on the implications of tax devolution for England, as part of a review of tax policy-setting powers for the territories of the UK.

The paper was published as a result of Scotland's "No" vote in the September 18 independence referendum. The morning after the referendum, UK Prime Minister David Cameron said that: "Just as the people of Scotland will have more power over their affairs, so it follows that the people of England, Wales, and Northern Ireland must have a bigger say over theirs."

Earlier this month, the Smith Commission, set up by Cameron to investigate the possibility of further Scottish devolution, recommended that the Scottish Parliament be given control over income tax rates and bands.

Cameron's Conservative Party in particular has championed the concept of "English votes for English laws," and the command paper sets out its interpretation of this principle. It also includes comments from the Liberal Democrats, the junior party in the UK's Coalition Government.

The Conservative section suggests that an English "Grand Committee" of members of the UK Parliament could be required to give consent to levels of taxation and welfare benefits where the equivalent rates have been devolved to Scotland, or elsewhere in the UK. However, as William Hague, the Conservative Leader of the House of Commons, told lawmakers, the party envisages that "the overall macro-economic decisions of the country always remain a matter for the UK as a whole and for the whole of Parliament."

The Liberal Democrat section, on the other hand, urges that cities, counties, regions, and other appropriate geographic entities "develop their own elected bodies with their own suite of administrative, legislative, and taxation powers."

TAGS: tax | law | United Kingdom | tax rates | tax reform | individual income tax | Scotland

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