SIR - According to this year's Budget Report, the yield from council tax in 2004-05 is set to be £19.7 billion, which is £7.4 billion more than if council tax had risen in line with the retail price index since the Conservatives' final year in 1997. The Treasury Ready Reckoner reveals that the real increase is equivalent to 2.2p on the basic rate of income tax - in other words another stealth tax.

The Lib-Dems say they plan to scrap council tax in favour of a local income tax.

Does this mean a huge extra department locally to which one has to disclose personal facts and figures? Would it involve income held by husband and wife separately and possibly children, still living at home but earning? What about student nurses and students at college who often have jobs during holidays?

It could surely mean two identical, side by side houses, paying hugely different taxes. The poorest pensioners receive council tax benefit and do not pay council tax. Seventy-one per cent of all pensioners receive income from their own investments. This income would be taxed under the Lib Dems' proposals.

Dreena Menelaws, Byron Road, Dursley