§ 8. Mr. Donald Stewart
asked the Secretary of State for Scotland what representations he has received regarding the position of crofters under the Valuation and Rating (Scotland) Act 1956 in so far as it relates to the reduction from gross to net value in the valuation of their houses, in the context of the proposed legislation on the abolition of domestic rates in Scotland.
§ Mr. Ancram
My right hon. and learned Friend has received representations on this matter from the Western Isles islands council, the Crofters Commission, the National Farmers Union of Scotland, the Scottish Crofters Union and the Harris Council of Social Service, as well as from a number of individuals in the crofting areas.
§ Mr. Stewart
I thank the Minister for his reply. Is he aware that the arrangement for rating crofts has been accepted for a long time by all Administrations as being fully justified and essential, and that if it is changed as a result of the legislation there will be severe social and economic consequences? There will be no incentive whatever for crofts to remain in the outlying areas of the islands or mainland.
§ Mr. Ancram
I listened to the right hon. Gentleman, but he is as aware as I am that the reliefs at present attach to property, and that the Green Paper's proposals suggest the abolition of a property tax and its replacement with a 255 personal community charge. A community charge will be much simpler, in that there will be a flat rate per adult, with a rebate available through the social security system to protect those on low incomes. The right hon. Gentleman may be interested to know that, on this year's expenditure, a community charge in the Western Isles would be about half the average applied in mainland Scotland.
§ Mr. Michael Forsyth
Will my hon. Friend confirm that because of lower incomes and the narrowness of the tax base in the crofting areas, a local income tax, as suggested by the SNP and the alliance, would have a catastrophic effect on Crofters and would add a substantial burden to the amount that they would have to pay in income tax?
§ Mr. McKelvey
Does the Minister recall that I recently sent him a letter on behalf of a crofter in the rural area of Kilmarnock and Loudoun? That crofter is complaining that he does not qualify for the crofters grant because he is not in the designated area. Why is the Minister discriminating against my crofters?
§ Mr. Ancram
I am grateful to the hon. Gentleman. He is always helpful. We can end this discrimination by removing the property tax element of local government financing and introducing a community charge.