Kezia Dugdale gets bold with risky pre-election tax move

Anyone longing for Kezia Dugdale to take the fight to the SNP just got their wish.

Call it a Penny for Fairness. The Scottish Labour leader has pledged to hike Scots’ income tax by one per cent should her party win the Holyrood election in May. (Itself contingent on lightning striking the same flying pig twice and the Pope converting to Rastafari on Easter Sunday.)

It would mean those forking over 20% and 40% of their income to the state would have to stump up 21% and 41% respectively instead. Labour tells us someone on a £30,000 salary would pay under £4 a week extra compared to Nicola Sturgeon on £144,687 a year (cute, real cute) who would have to find an additional £28 a week. The party adds that one in four Scottish workers would see their taxes stay the same while a further one in five would pay less thanks to a new, locally-administered tax rebate scheme.

The tax grab is designed to offset the SNP’s £350m cuts to council budgets, which has brought the Scottish Government and local government umbrella body COSLA to a stalemate. It comes after the Scottish Liberal Democrats’ similarly progressive Penny for Education was unveiled last week.

According to the Scottish Daily Mail, Dugdale’s announcement “will raise fears the SNP leadership could also lurch to the Left and further hammer middle-class families”. It is telling that the authentic voice of Middle Scotland is unnerved by the prospect of Labour pushing the Nationalists to the Left. Contrary to the gushings of day-tripper liberal columnists up from London for a look-see during last year’s general election, the SNP is not a radical outfit but a cautious, fiscally conservative one.

It has won two devolved elections and governed from the centre ground, during which time middle income families have been protected at the expense of the poor and the struggling. No one can blame the Daily Mail for sticking up for its readers’ interests but self-styled “progressive” Nationalists might want to pause and ask why a newspaper they vituperatively define themselves against is so keen to maintain the SNP status quo.

The Scottish Tories are blunter than the Mail. “Labour,” they blare, “has lost the plot”. And to be fair, it has. Led at UK level by a nukes-surrendering Marxist who buddies up with terrorists and seeks an “accommodation” with the Argentinians over the Falklands, Labour does seem to have set itself up for a lengthy sojourn in the funny farm.

But Dugdale’s Penny for Fairness is hardly full communism now. It is bold and progressive and could compel Nicola Sturgeon to do something she has largely avoided during her year of living timidly: Take a decision. Is she for or against progressive taxation?

The First Minister has one of two options. She can tough it out, keep faith with the wisdom that has always guided the smartest minds in Scottish Labour and the SNP: Scots want to be told they are Norwegians but they want to be taxed like Nebraskans. Or she could repeat the ruthless gambit that saw her pinch wholesale Labour’s progressive tax policies ahead of the 2015 general election. The difference is: Her party will win this election and win it outright; she will have to deliver the policies she puts forward or be judged accordingly.

Is Scotland willing to pay more tax for better services? Even if we aren’t, there is strategic value to Dugdale’s policy. Labour cannot win in May – it cannot even deprive the Nationalists of a majority – but it can nail them down once and for all. Labour has nothing left to lose so why not go down swinging, left-hooking the SNP again and again. Define them as the dead-centre triangulators they are; cause some unease in their ranks; force a few internal ructions and a misstep here and there.

There is a nobler concern at stake. The self-delusion that we can fund social democracy on Thatcherite tax levels is no longer a mere political curiosity but a very real threat to quality public services. For proof look no further than the SNP’s nine-year council tax freeze. A vote-winner for the Nats but a grim reaper for local services, especially those relied upon by the poor and socially excluded. New Labour cleverly deployed stealth taxes and redistributed on the QT but political and economic minds like Tony Blair and Gordon Brown come along once in a generation, if that.

The choice facing voters, in Scotland as elsewhere, is whether they are prepared to pay modestly higher taxes or whether they can live with workmanlike public services. I suspect most would respond the former and vote the latter but for the sake of a mature debate on public policy the question has to be put. Scottish Labour knows it is going down to defeat on the political argument; why not have a stab at winning the intellectual argument.

Of course, that’s not what political parties are for. They’re here to win elections. These days in Scotland that’s the SNP’s job, not Labour’s, but they’ve had a very easy ride for a very long time. Kezia Dugdale’s Penny for Fairness could put an end to that.

The Red Tories are dead. Long live the Yellow Tories?

Originally published on STV News. Feature image © Roman Oleinik by Creative Commons 3.0.

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