I'm John Dachto with Joseph Sternberg.

He writes political economics.

He's based in London.

He's a member of the editorial board of the Wall Street Journal and I read headlines but I'm not

certain that they're not exaggerating to get me to read the paper. One says that

the UK is in a recession that has a technical term but it also is a mood. a 5% nearly everywhere. In other words, raising taxes in a recession. I had to check with Joe.

Joe, what is a council tax? Raising taxes in a recession. Does anybody scream in Parliament?

So, John, a council tax in the UK is the nearest that Britain has to an American property tax.

So it is kind of based on the value of people's business or residential properties, but the key point is that everyone pays it because it's essentially an occupancy tax instead of an ownership tax.

And that is politically relevant because it means that even if you have a large

population of renters as the UK does, those people directly see the council tax bill that is not hidden in the rent that they're paying to the landlord who would have to pay property tax.

And these taxes fund a lot of local services from local governments, things like trash collection, part of the education funding,

provision of various social services, road maintenance, all of that stuff.

And costs for local governments are going up up so they've got permission to increase

the council tax starting in the financial year that will begin in April.

But again, I mean this creates a big problem several times over.

First off, because everyone pays it, which means that everyone is now going to have more

money coming out of their pocket each month in order to pay this higher council tax bill.

And also because as you point out,

there is now evidence that the British economy

was in recession for the second half of last year.

We had two consecutive quarters of GDP contraction on and raising taxes is the last thing that you want to do if you want to try to boost consumer confidence or business investment or any of the other things that you need for growth.

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