Analysis of the distributional consequences of the introduction of the Council Tax in England in 1993
The thesis's principal aim is to investigate the distributional impact of the introduction of the Council Tax as the Community Charge's replacement in England in April 1993. The thesis's empirical analyses consider the distribution of the local tax burden at the household level in terms of income groups, household types and geographical location. The research models the introduction of the Council Tax using a large set of data provided by the Nationwide Anglia Building Society. These data comprise details of over 75,000 mortgages granted by the Building Society between 1988 and 1990 and are sufficiently detailed to allow calculation of individual and household liability for both Community Charge and Council Tax. The Council Tax is chiefly a property tax based on the capital value of domestic property. Because the capital value of domestic property is unevenly distributed both geographically and across income groups, necessarily the Council Tax's burden is also distributed geographically and across income groups. Previous distributional analyses of the impact of the Council Tax have been unable to consider this spatial distribution. However, the Nationwide Anglia data allow analysis of this spatial distribution. The thesis considers a number of influences on the tax's distribution - the use of capital value as a tax base; the operation of the Revenue Support Grant; the Council Tax Transitional Relief Scheme; the Council Tax's hybrid personal / property tax design; as well as the distributional implications of the transition to a form of property tax from the Community Charge's flat- rate poll tax. The final chapter uses the implications of the preceding distributional analyses to consider the Council Tax in the longer term as part of a broader solution to the historic difficulties of the overall local government finance system.