PENSIONERS' COUNCIL TAX CUT DASHED

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HOPES OF A COUNCIL TAX CUT FOR PENSIONERS NEXT YEAR WERE DASHED YESTERDAY.

Lawyers warned that any discount would break human rights laws and the government’s forthcoming rules against age discrimination. Other groups such as single mothers would 'clog' the courts demanding similar privileges. The legal opinion by leading local government lawyer James Goudie QC forced a string of councils to abandon plans for Council Tax reductions for the elderly

This was despite Deputy Prime Minister having approved the scheme. Kent County Council, which introduced the idea, dropped the plan after being told it would 'bring endless legal problems and court challenges'. Hampshire, Surrey, West Sussex, Hertfordshire and Norfolk also scrapped the proposal.

The scheme would have meant Council Tax bills for pensioners would have gone up in line with inflation, meaning they would have paid - on current predictions - average increases of around £25 a year instead of £100. Other Council Tax payers would have been asked to pay an extra £12 on their bills to fund the pensioners' discount.

Ministers now face the threat of a widespread tax rebellion and civil disobedience if the local tax goes up by the expected £100 next April. Kent Tory leader Sir Sandy Bruce-Lockhart said last night: 'In view of the legal advice we will reluctantly not be pursuing our ideas for a pensioner rebate.

'We will, however, be putting all our energy into keeping the Council Tax down.'

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2M STRUGGLE WITH COUNCIL TAX

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THE COUNCIL TAX SYSTEM WAS UNDER FIRE TODAY AFTER A STUDY FOUND MORE THAN TWO MILLION HOUSEHOLDS STRUGGLING TO KEEP UP WITH THEIR PAYMENTS.

Ruthlessly snatched back in local taxes

The Conservatives said it had turned into "the ultimate stealth tax", while Help the Aged said local taxation based on property values, instead of ability to pay, was inherently unfair. According to a report commissioned by the Joseph Rowntree Foundation, those on low incomes are particularly badly affected in the current system, having to stump up a larger slice of take-home pay than those on higher wages.

The study found nearly three million summonses for non-payment of Council Tax were issued every year, affecting an estimated two million households. Among those struggling, low income is cited as the main reason for non-payment, the charity said.

Dr Michael Orton, author of the report, said: "Despite having a job, the struggle to pay Council Tax is part of the day-to-day difficulty of making ends meet for many people. Low income creates vulnerability to missing payments and repaying arrears."

A key part of the problem is the regressive nature of Council Tax, with a greater share of income taken from those on lower and middle earnings, according to the report. The study said Council Tax accounted for almost 5% of gross income for the bottom fifth of households and 3.7% for households in the second to bottom fifth. But for those at the other end of the pay scale - the UK's top fifth earners - Council Tax accounted for just 1.7% of income.

Dr Orton said: "Many low income households receive benefits. However, the report found that interviewees' experience of Council Tax benefit focused not on take-up, which in itself is poor, but at the low level of income at which people cease to be entitled, as well as administrative problems and the sheer complexity of the system." Greater consideration needs to be given to make the tax fairer by revising the proportion of tax levied on each valuation band, the report concluded.

Shadow local government secretary Caroline Spelman said: "The Government's abuse of the Council Tax system has turned it into the ultimate stealth tax. "A third of the basic state pension increase since 1997 is now ruthlessly snatched back in local taxes. "Labour's increased use of means tested benefits and complex application forms has resulted in a reduced take-up of Council Tax benefit, so more people on lower incomes are paying higher Council Taxes. "Hard-working families and pensioners are suffering from ever-increasing bills across the board - gas, electricity and water.

"But with Council Tax having shot up 84% under Labour, it is meeting this monthly Anna Pearson, spokeswoman for Help the Aged, said: "Around two million pensioners in this country are affected by poverty and, for many, life is a matter of getting by from week to week.

"Millions of older people face rising bills which overwhelm the meagre increases in the basic state pension. For many, this results in a life of deprivation and cutting back on essential items.

"The complex Council Tax benefit system merely serves to act as a barrier, being virtually impossible for anyone to understand. It is high time the Government realised that local taxation based on property values, instead of ability to pay, is inherently unfair."

A spokesman for the Department for Communities and Local Government said: "Government has made substantial investments in local government that allows authorities to provide high standards of service while keeping down Council Tax increases. "Funding to local government has increased by 33% in real terms since 1997. Total support from Government grant and business rates in 05/06 amounted to more than £60 billion - £3.5 billion, or 6.3%, more than in 04/05.

"Ministers have used capping powers to protect Council Taxpayers from excessive increases and will not hesitate to use them again. "It's also important to recognise that 14% of all Council Tax is met through Council Tax benefit."

READ WHAT: ERIC PICKLES ‘SECRETARY OF STATE’ SAYS ABOUT OVER-CHARGED COUNCIL TAX.

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COUNCIL TAX DODGERS PUT ALL BILLS UP £50

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TAXPAYERS ARE BEING FORCED TO STUMP UP AN EXTRA £50 A YEAR TO PAY FOR COUNCIL TAX DODGERS. 

Up to 650,000 people failed to pay their Council Tax last year, and the scale of evasion by individuals and businesses cost the Treasury more than £1bn. This is the equivalent of £50 on average added on to everyone else's Council Tax bill. The disclosure brought an angry response from ministers, who accused councils of throwing money away and piling up unnecessary bills for honest taxpayers.

Council Tax is considered one of the easiest taxes to collect because it is hard to hide a home or mask its size. Yet the figures from the Communities Department showed that collection rates in England have not improved in the past three years. 

Inner London boroughs are bringing in less of the money they are owed than in 2007. Out of £22.1bn in Council Tax that should have been paid in the year to April, only £21.4bn was actually collected, leaving town halls £700m short.

This meant that just under one householder in 30 - roughly 650,000 people - got away without paying their bill. An average English Council Tax bill last year was £1,175. The highest number of Council Tax dodgers was found in London, where 4.3 per cent of householders failed to pay.

It is more difficult to collect the tax in London because of the high number of young people in the population and the large proportion who move regularly. However, there were also low collection rates of below 97 per cent in Yorkshire, the North-West and the North-East.

Communities Secretary Eric Pickles said: 'Every penny of Council Tax that isn't collected means higher Council Tax for the law-abiding citizens who do pay up on time. 'Councils with an efficient collection service are able to set lower Council Tax bills for everyone or spend more money on front-line services such as bin collections. 'The new Government will be making councils become more open and transparent about the money that is being thrown away from not collecting Council Tax. 'Once residents know how much cash is being lost due to poor administration, they will demand action from their councils to raise their game.'

Mr Pickles added: 'It is important that councils are sympathetic to the vulnerable and families who are struggling in the recession, and don't overuse bailiffs. 'But a lot more could be done to improve the back office service, especially in inner-city areas which have the worst collection rates.' Business rates, which are set by central government but collected by councils, also showed a poor return last year. The amount of business rates due was £20bn but only£19.6bn was collected, leaving a shortfall of £400m. The collection rate for local business taxes have fallen by a full percentage point, from 98.8% to 97.8%, since the recession began in 2008.

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GOVERNMENT RULES OUT COUNCIL TAX REVALUATION DURING CURRENT PARLIAMENT

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THERE WILL BE NO REVALUATION OF COUNCIL TAX BANDS IN ENGLAND DURING THE CURRENT PARLIAMENT.

Communities and Local Government Secretary Eric Pickles have announce. Mr Pickles announced an independent review of Council Tax inspections, which he said would 'rein in intrusive snooping' by limiting the data gathered and stored about people's homes. 


The Communities Secretary said families in England could save up to £320 a year in local tax hikes from his decision not to go ahead with a revaluation being planned. But the opposition denounced his claims as 'cynical and misleading', pointing to a pledge in this year's election manifesto which promised:

'We will not hold a Council Tax revaluation in the next Parliament.' Council Tax bands in England are based on valuations of property carried out in 1991. Plans for a revaluation of 22m homes in 2007 were postponed by the former Labour government in 2005, amid anger over a previous exercise in Wales which led to tax hikes for many households.

Mr Pickles said the Welsh revaluation led to one-third of homes moving up one or more bands - four times as many as moved down. The less well-off were hit the hardest, with two-thirds of the hikes in homes that were originally in the lowest three bands, he said. If the experience of Wales were repeated in England, families in homes moved up one band from D to E would face a tax hike averaging around £320 a year, said Mr Pickles.

This would increase the burden of Council Tax bills which rose under Labour from £688 for a typical Band D home in 1997/98 to £1,439 in 2009/10, said the Communities Secretary. Meanwhile, the taxpayer will save up to £180m on the cost of administering a revaluation exercise, he said. An independent data audit of the Valuation Office Agency (VOA) will protect privacy and civil liberties as part of the new Government's agenda of dismantling the 'database state', said Mr Pickles. The VOA's inspectors assess properties' value for Council Tax purposes, and there was previously controversy over their collection of data on features of homes such as the number of bedrooms or bathrooms, whether it has a patio and whether it enjoys a nice view or is in a good neighbourhood.

Mr Pickles said: 

'We have cancelled Labour's plans for a Council Tax revaluation which would have hiked up taxes on people's homes.' 'The new Government will protect the privacy of law-abiding citizens from intrusive spies-in-the-sky and halt state inspectors from barging into England's bedrooms and gardens. 'We are standing up for the people who have pride in their home, and calling time on Labour's state snoopers and surveillance state. 'Hefty Council Tax bills are a constant financial worry for many people. We are setting their minds at ease, and protecting the interests of the less well-off in particular that were the hardest hit from Labour's Council Tax revaluation in Wales.'

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70,000 HOMES 'FACING COUNCIL TAX HIKE'

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MORE THAN 70,000 HOUSEHOLDS ARE PAYING HUNDREDS OF POUNDS EXTRA IN COUNCIL TAX AFTER THE GOVERNMENT REVALUED THEIR HOMES 'BY STEALTH', IT WAS CLAIMED YESTERDAY.

Stealth rise?  More than 70,000 households are paying extra Council Tax after revaluations those who bought homes that had been improved by the previous occupants have seen their bills rise by an average of£195 a year, said the Liberal Democrats.

Council Tax 'snoopers' have placed the properties in a higher band because of changes such as new conservatories, porches, extra bedrooms and parking spaces. Inspectors from the Government's Valuation Office Agency have moved 70,010 homes into a higher band since 1997 when the opposition came to power.

Statistics published by the Department for Communities and Local Government showed that nearly 391,000 properties had been revalued in the past decade. Of these, about one in five was moved to a higher band after being studied by officials - forcing residents to pay out more. Ministers insist that a Council Tax revaluation has been put off at least until after the next general election. They fear millions would rebel if their bills increased because they were moved into higher bands.

But last night, the LibDems, who uncovered the figures, accused them of carrying out the exercise by stealth. Local government spokesman Julia Goldsworthy said: 'With almost 400,000 homes being revalued, Labour's lie of putting off Council Tax revaluation is clearly exposed. Tens of thousands of families are being hit in the pocket.

'It's time that the Government came clean and either admitted that this stealth revaluation is taking place or recognised that Council Tax is not fit for purpose. Until they ditch this unfair and unpopular tax, families will continue to face unaffordable Council Tax bills based not on ability to pay but simply on the value of their home.'

Under regulations introduced in 1993, the VOA logs every structural improvement that takes place to a property. If the home is then sold, the agency is notified and can decide to carry out an inspection to determine whether it should be in a new Council Tax band. According to the LibDems, the average Council Tax bill is £1,146 and the average difference between bands is 17%. It means that under revaluation the average bill would rise to £1,341 - up £195.

At present, Council Tax bills are based on assessments of properties made in 1991. A spokesman for the Department for Communities and Local Government said yesterday: 'An increase in the value of a property would not lead to an increase in a Council Tax banding until the property is sold, and maybe not even then, as the value may stay within the range of the existing band.

'As we have said on many occasions, there is no revaluation of Council Tax taking place. Any claim to the contrary is absolute nonsense, nothing more than scaremongering, and only serves to make people, particularly the elderly and vulnerable, needlessly frightened.' Last week, official figures showed that VOA inspectors have already stored digital images of 1.6m properties and are collecting details of millions more. They are logging the number of bedrooms, bathrooms and conservatories as well as noting down details of attics, porches and outbuildings.

Critics claimed it was evidence that every homeowner was facing an invasion of privacy as the Government carried out the revaluation in secret. A 'training manual' for VOA inspectors says they must carry a 20-metre tape measure or laser measuring device, camera, clipboard, survey sheets, pens and pencils, eraser - and a personal alarm.

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