The Olympics Stealth Tax

Now that the dust has settled on the bid triumph for London hosting the 2012 Olympics, financial reality is beginning to crystalise in the minds of the British.

Taking a lesson from the Greeks, who ended up paying $12Bn for their loss making Games, some British people are beginning to worry about the cost of the Games.

Jacqui Lait, the shadow minister for London, said that the Games could be used to introduce a "stealth tax" on London.

The Olympics are supposed to cost Londoners around 38p a week, but the Conservatives say that the draft legislation contains no provision for a supplementary rate earmarked specifically for the event; the money will instead be raised as part of the overall council tax precept, which is added on to residents' overall council tax bill.

In other words taxes will be raised on the pretext of financing the Games, but the money raised will in fact be used elsewhere.

Ms Lait said:

"The Olympics are a great opportunity to showcase the best that London and Britain have to offer. But amid all the Olympic excitement, we have a duty to ensure that Londoners are not being forced to write a blank cheque to Ken Livingstone or his successors. Conservatives have grave concerns over the extra levy planned for London council tax bills.

Any Olympics levy must be transparent, ringfenced and time limited. Given the Labour government's past poor project management of large public sector projects, such as the dome, we must ensure measures are put in place."

Ken Livingstone's office rebutted the claims, saying that the tax increase would be nominal and would end as soon as the event was over.

A spokesman said:

"There will not be cost overruns from the games. We are confident that our public funding package will be sufficient, and our financial planning has been meticulous - a point recognised by the IOC [International Olympic Committee] evaluation commission.

The funding package agreed with government means that the average London household will pay 38p per week for up to 12 years."

I don't believe that for one minute.