Wandsworth is planning on keeping council tax at the same rate for the third year running. In one of those bizarre twists of local government finance Wandsworth’s average council tax is dropping because the Putney and Wimbledon Commons Conservators (who levy a precept to maintain the commons) are reducing their precept.

The video features Deputy Leader Maurice Heaster talking about it. You’ll note that one way we keep council tax low is by avoiding unnecessary expenditure on things like microphones.

The Robin Hood Tax has been a fascinating example of emotion defeating logic and fact. As it invariably will.

I’m a Conservative, so I’m instinctively inclined not to support increases in tax, let alone new taxes. That’s not to say I don’t recognise the need for tax and (some) of what it funds. But the support the Robin Hood Tax is attracting surprises me. Well, actually, it doesn’t.

I’m not in the least bit surprised because I can see the emotional appeal. Let’s have a tiny tax on nasty people that raises lots of money for good things. Who can possibly disagree?

Many have. Pointing out that such a tax would require unprecedented international co-operation to work and if only a few countries didn’t participate those levying the tax would be at an economic disadvantage. Or that the hundreds of billions of pounds the tax would raise would have to come from somewhere, this isn’t new money (despite the assertions of actor/economist Bill Nighy) and however banks deal with it the effects will be felt.

But these sorts of arguments will never defeat the raw emotional appeal of hurting the evil bankers. And, let’s be fair, that is the point. It is presented as a way to get back at bankers without causing pain elsewhere. It’s about vengeance.

So why stop with 0.005%? If part of the argument is that it’s so small they won’t notice then why not double it. Then you raise twice as much. In fact, let’s go for 1% – that’s still tiny but you’d raise 200 times more and might hurt those evil evil bankers.

The thing I dislike about the whole campaign is the inconsistency of it. On one hand it’s something that will make bankers pay, on the other they won’t even notice. On one hand it won’t affect the economy or markets, but on the other it will take hundreds or billions of pounds out of the markets.

But this goes unnoticed because of some clever labelling. Associating it with Robin Hood, and the idea of taking from the undeserving and giving to the needy is brilliant, (even if it does overlook that Robin Hood was really about fighting an oppressive state that was eroding civil liberties, they were fighting the same John that was forced to sign Magna Carta at Runnymede). It means that it’s not just economists and politicians talking about it, but now celebrities can jump on the bandwagon. They couldn’t do that if it were the ‘The Genghis Khan Tax’ could they?

It’s a bad idea. But great marketing.

The earliest post on this blog is from 24 November 2008 on the benefits of low taxation (actually the blog wasn’t public until nearly a month later, on 17 December, but that was the oldest surviving test post).

In it I suggested that the temporary VAT cut probably wasn’t that good a measure, and that efficient and effective government was a much better way of putting money in people’s pockets.

I still hold to that. I don’t think the VAT cut really helped that many people (I have saved a few quid over the year, but I’ve probably not spent any more or less than I otherwise would have). The poorest benefited least, because a larger part of their spending was on VAT-free or reduced VAT items. And I suspect the impact of the rise will more than outweigh the effect of the cut – not because the figures are any different, but from the purely psychological effect a tax increase has.

And then there are all the other tax increases. A 45% tax on high earners. A 50% tax on banker’s bonuses. In the current climate, in which being a high earner is becoming a mark of shame and bankers deserve hanging, drawing and quartering these will doubtless be popular. I’m sure Darling is hoping they’ll be enough to help people to overlook the years Labour spent cosying up to the City or that it was the financial powerhouse behind a lot more years of growth than years of recession.

The ½p increase in National Insurance will perhaps be less popular (since it is, effectively, a tax rise) and public sector workers will, no doubt, be disappointed to hear that they will be having a 1% cap on pay increases for two years (a good chunk of which will be wiped out by the National Insurance increase).

There was some other tinkering. I can only view his boiler scrappage scheme as petty politics since he clearly knows I’ve just replaced my boiler. And I’m sure Gala Bingo in Tooting will welcome the drop in bingo duty. But the deferral of the corporation tax increase for small businesses obviously has to be welcomed.

However, the key problem, the elephant in the room, is the borrowing. And nothing here really seems to be tackling the problem the next government will have to face – indeed, he raised his borrowing forecast. So while we have the promised bill to half public debt in four years there is nothing to back it up.

Darling had the chance of being the real Iron Chancellor today, putting politics aside and making announcements that might be politically painful but in the national interest. His announcements may not have been electoral bribes, but failed to grasp the nettle of public spending.

And, like a year ago, I come to the same conclusion – the best solution is good, efficient, Conservative government.

The Garrett Business Park Business Improvement District (BID) vote was counted yesterday.  One of the powers a BID has is to charge an extra levy on business rates to be invested within the district.

The proposal came about after a lot of hard work from the business association and Angela Graham, one of the local councillors.  Having visited the business park I could see why they wanted the BID to help them invest in the crumbling roads they had to use, so wasn’t surprised when the vote was successful.

However, I was astounded by the margin of victory for the ‘yes’ vote – a 68% turnout with a 90% yes vote.  These are businesses, facing recession, voting for more taxation!

But, of course, what they have actually voted for is the right – for the first time – to see their business rates benefiting them.  Up until now they’ve been paying into the national pot which is unfairly distributed to Labour’s friends in the north.

It’s a fairly common complaint I hear from businesses that business rates keep going up – and I have to explain that although the government makes Wandsworth collect them we don’t get to set them.  It’s a ridiculous situation that really needs to be changed.  Here in Wandsworth we give residents low council tax and excellent services, we should be allowed to offer the same to businesses.

Mayor of London, Boris JohnsonIsn’t it odd to hear the Labour and Green Party GLA members belittling Boris Johnson’s council freeze because it will only save 11p a week on council tax? These are the same people who presumably believe that 2.5% off VAT will save the world.

What they fail to realise is that we finally have a Mayor who is serious about controlling the City Hall budget, and that’s good news that doesn’t just last until the end of next year.

In his 8 years as Mayor Ken Livingstone managed to double the precept City Hall took to run the GLA from £150 to over £300 – that’s about 11% a year. Assuming past record is a good indicator of future performance (and I reckon eight years is enough to get a handle on him) it means the difference between a Johnson and Livingstone mayoralty is that the average household will be £400 better off.

Today Alistair Darling will announce that Labour have finally seen the benefits of low taxation.

Or has he?  The BBC is currently reporting an expected temporary reduction in VAT to 15%, along with the introduction of a new higher rate tax band and the postponement of various other changes.  In other words, we’re increasing taxes, not immediately, but it’s coming.

And it’s questionable who will benefit from the reduction in VAT.  Any reduction in tax is not to be scoffed at, but if you take a low income household and consider where their income goes, much of it is spent on VAT exempt goods.  The weekly food shop – mostly VAT free.  Children’s clothes – VAT free.  Fuel bills -already at a lower VAT rate.

Of course, they’ll save a few quid on their Christmas shopping, but I suspect that’s small consolation when the parents fear for their jobs as we head into recession.

Is there another way?  Well, there was a good article in today’s Telegraph that points out that Conservative controlled councils are about the only places you see efficient, well-run and affordable government nowadays.