Scottish business leaders yesterday voiced "very great concern" about the proposed taxation powers of a Scottish parliament. The Scottish CBI described the proposal to vary the basic rate of income tax as "flawed". It said it raised problems over assessment, collection and compliance.
It also expressed "severe concern" at the British government's proposal for a Scottish parliament to have power over non-domestic rates, which it fears could spell the end of the uniform business rate.
The Scottish CBI said the positive economic and business case for devolution was not proven, but recognised that there were wider issues involved than business and economic issues alone.
But it said: "A number of the financial arrangements, however, cause very great concern. The proposed powers to increase or decrease the basic rate of income tax by a maximum of 3p is flawed, and there will be problems and costs associated with assessment, collection and compliance."
Nor, it added, did it favour the Scottish parliament having power over non-domestic rates. "The uniform business rate is now effectively a national tax consistent with the level playing field across the UK which Scottish business in particular greatly values, having argued for it over many years.
"The UBR was long in coming and to have its future determined on a non-national basis is a matter of severe concern."
Labour spokesmen have refused to comment on claims yesterday that an internal inquiry into Glasgow City Council had reached damning conclusions. The Sunday Times reported that a 21-page inquiry found "a culture of patronage" and deep-seated sleaze.
The report claimed that evidence was found of councillors offering favours in exchange for votes; verbal and physical abuse and intimidation; and strong circumstantial evidence of "votes for positions" - such as jobs as magistrates.
The report also claimed the suspension of 12 councillors was one key recommendation of the inquiry, with some matters unresolved by Labour investigators to be referred to the police.