Taxes are always controversial, the old rating system was considered unfair, as it taxed those residents that owned a home, those that rented from the local authority a portion of their rent paid for local services, in 1989 the poll tax was introduced as an alternative, on the premise that every user of services should pay. (i'e anyone over 18 )
In this melee, the powers that be forgot that council rent payers already had a portion of their rent allocated as rates, with the introduction of the poll tax / community charge, council rent payers had an additional burden, as the portion of the rent they paid as rates was ignored.
Rents did not go down to compensate for the proportion of rent paid as rates, and instead, the portion of rent paid as rates was absorbed as just rent, with an additional tax then called the community charge.
This led to widespread unrest, especially amongst young adults who had to pay, regardless of having a 'stake' in society (property ownership) hence the poll tax riots of the early 90's
What Government failed to realise is that people are mobile, and will move from area to area, even country to country, hence the Poll tax / community charge was hard to collect and had a serious impact on local authority income, unfair as it may seem a house is going NOWHERE, so is viewed (at the moment) as a stable source of taxation.
This led to the Council Tax, and those renting accomodation from the local authority, not only had to pay their rent (which a part of in the past was allocated to rates), they now had an additional bill (now called Council Tax)
Some argue that there is a means tested benefits system to make sure the poorest members of society are not penalised for this tax, others argue that because they have saved and own their own property they cannot have access to this benefit, as they own their property, and this is classed as an asset, to be bought and sold as any other asset, to pay the tax.
Somewhere along the line, someone somewhere forgot that a Home is just that, a place to live, not an asset to buy and sell to raise money, it is somewhere to live.
The UK is a property obsessed nation, with high home ownership, some of which is multiple occupancy leasehold property, just to 'own the dream', or 'get on the property ladder' when anyone who knows anything about property will tell you, if you can AFFORD to, BUY FREEHOLD PROPERTY, if not, RENT LEASEHOLD,untill you can AFFORD to buy FREEHOLD, somewhere along the line this message has been lost.
There have been increased cases of elderly property owning pensioners going to jail for failure to pay / afford to pay the Council Tax, the council tax system is currenty under reveiw, with numerous articles appearing in the press.
http://business.timesonl...oney/article3128628.ece
Maybe when we lose our notion that a roof over our heads is a cash cow / bank account, will we have a truly stable economy, (the sub prime recession in the USA has been built on Home ownership on those that cannot afford it) and as a result of this, we might end up with a fairer Tax system. (though knowing politicians I won't hold my breath)
Governments should be more transparent about taxes, with the approach of "This is the rate to pay for this good or service, and this is what is required to deliver this service", stealth taxes, of whatever kind, make people distrust Government, (local and National) and eventually distrust the whole Tax system.
