Council Tax Rebates:

PENSIONERS' COUNCIL TAX CUT DASHED

2013-06-06T07:33:00.002+01:00

FIRST PUBLISHED BY: THIS IS MONEY

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.'

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

ARE YOU PAYING TOO MUCH COUNCIL TAX -CHECK HERE?

2M STRUGGLE WITH COUNCIL TAX

2013-06-05T07:30:00.003+01:00

FIRST PUBLISHED BY THIS IS MONEY

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.

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

COUNCIL TAX DODGERS PUT ALL BILLS UP £50

2013-06-04T08:06:00.003+01:00

FIRST PUBLISHED BY: THIS IS MONEY

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.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX -CHECK HERE?

GOVERNMENT RULES OUT COUNCIL TAX REVALUATION DURING CURRENT PARLIAMENT

2013-06-03T09:02:00.001+01:00

FIRST PUBLISHED BY: THIS IS MONEY

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.'

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

ARE YOU PAYING TOO MUCH COUNCIL TAX -CHECK HERE?

70,000 HOMES 'FACING COUNCIL TAX HIKE'

2013-06-02T11:06:00.002+01:00

FIRST PUBLISHED BY: THIS IS MONEY

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.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

MINISTERS DENY PLANS TO RAISE COUNCIL TAX

2013-06-01T09:37:00.003+01:00

FIRST PUBLISHED BY: THIS IS MONEY

THE GOVERNMENT HAS DENIED IT IS PLANNING TO RAISE EXTRA CASH FROM MILLIONS OF HOUSEHOLDS WITH A NATIONWIDE COUNCIL TAX REVALUATION.

Threat: Many could be pushed into paying more Council Tax. The Government has quietly renewed a multi-million pound deal with one of Britain's leading property websites to access details of sale prices and floor plans of tens of thousands of homes.

Ministers had been 'caught red-handed' preparing for a nationwide reassessment of property values if they win the next election. Current Council Tax bills are based on assessments of properties made in 1991.

A revaluation would see millions moving into higher Council Taxbands and facing bigger bills. A Council Tax revaluation in Wales saw four times as many homes moving up a band as moving down. The contract between tax inspectors and Rightmove, which boasts the largest private property database in Britain, is understood to be worth around £2.2m a year.

Since 2005, homeowners have been putting their property on the market for sale without necessarily realising that tax inspectors at the Valuation Office Agency are collating data about each home. A 34-month contract with Rightmove expired last March after a Council Tax revaluation was put on hold by ministers in September 2007. The contract was justified by the VOA because it would 'help the agency's efforts in having a cost-effective and efficient conduct of the revaluation'.

But new Parliamentary questions have revealed the deal was renewed last November and backdated to March 2008. Last month, Communities Secretary admitted that the pledge not to hold a Council Tax revaluation only applies to this Parliament, leaving the door open to one.

Tory local government spokesman Caroline Spelman said: 'ministers have been caught red-handed secretly preparing for a Council Tax revaluation in England. This contract was signed in 2005 specifically to prepare for the revaluation.

'The only reason why it has now been renewed after it expired is to help with a revaluation. The public will be alarmed that detailed information on nine out of ten house sales are secretly being passed from estate agents to tax inspectors without the public's knowledge or agreement.

A spokesman for the Communities and Local Government Department dismissed the claims as 'disgraceful scaremongering'. 'This commercial agreement for publicly available sales information is nothing to do with any supposed revaluation,' he said. 'The contract with Rightmove has been in place since 2005, and saves the taxpayer money by reducing the need for VOA staff to visit properties.'

However, the spokesman was unable to extend the pledge not to hold a revaluation beyond the next election. 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. A spokesman for Rightmove said: 'The agreement allows the VOA only to access data already published on the Rightmove website, though it allows the VOA to do so in a more efficient and cost effective way.'

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

ARE YOU PAYING TOO MUCH COUNCIL TAX -CHECK HERE?

4M TO LOSE IN COUNCIL TAX REVIEW

2013-05-31T10:08:00.002+01:00

FIRST PUBLISHED BY: THIS IS MONEY

FOUR MILLION HOUSEHOLDERS FACE COUNCIL TAX INCREASES OF £100 A YEAR OR MORE.

The estimate bears out the worst fears of homeowners in the South East that they will be punished for the rising value of their properties. Many middle-income earners in the South who live in Band D homes will pay an average of £270 more a year if their property moves up a band.

The four (4) million figures has been calculated by Sir Michael Lyons, the former town hall bureaucrat asked to find an alternative to Council Tax last year. His inquiry was shelved by the Deputy Prime Minister when ministers lost their nerve. The revaluation itself was also delayed indefinitely amid fears that it would result in large-scale tax increases. There has also been an outcry over the intrusive inspections bureaucrats have been empowered to carry out.

But an interim report from Sir Michael today urges the Government to go ahead with the revaluation in England - and tells ministers they should be honest about the fact that it will produce 'winners and losers'. His estimate means that four million householders' properties will be pushed up to a higher level in the bands used to calculate Council Tax bills.

An average Council Tax payer in England now has a bill for £1,009 a year. But those who pay bills on that scale for Band C homes in southern England would have to find an extra £112 if their property was reassessed as Band D. Many middle-income earners in the South already live in Band Dhomes. They pay more than their Band D counterparts in the North because, when the last valuation was carried out in 1991, their houses were already worth much more than similar northern properties.

Under Sir Michael's estimates, if their homes are pushed up to Band E they will face Council Tax increases of £269, up from an average £1,214 to £1,483. By contrast, many Council Tax payers in the North could see their homes drop down a band. That would benefit northerners already said by southern council chiefs to be paying disproportionately low bills.

Local government spokesman said: 'Sir Michael Lyons's interim report brings more bad news for the Government. Earlier this year, Labour panicked and postponed their revaluation for fear it would damage their chances in May's local elections. 'But this report only confirms what we already knew - when the revaluation does come, at least four million people will be hit with even higher Council Tax bills.' The warning of big hikes after revaluation undermines the Chancellor’s hopes of calming the Council Tax crisis by keeping increases next spring to around 5 per cent - still more than double the rate of inflation.

The Government has pumped an extra £1.1bn of taxpayers' money into town hall coffers to keep the bills down. A source close to the Deputy Prime Minister said there was 'nothing surprising' in the suggestion that four million householders would be paying more. 'By implication if we had four million people moving up, we would have had four million people moving down, because the intention was never for additional revenue to come to the Government,' the source said.

He said people could not continue to pay Council Tax based on 1991 property values indefinitely. Town hall money-wasters condemned HALF of all English councils are wasting money, a Whitehall spending watchdog warned yesterday. The Audit Commission said the authorities met only the minimum standards for the way they spent their share of more than £80bn a year.

The findings come as the Government and local authorities argue over who is to blame for soaring Council Tax bills. Commission chairman James Strachan said: 'We are concerned that half of all councils are only achieving at, or below, what we consider to be minimum acceptable level.' The watchdog states: 'Internal control, how well a council manages its risks and has effective arrangements to ensure proper use of public funds, is the area where councils most consistently under-perform.'Hull - home town authority of Deputy Prime Minister, who is in charge of local government - was among ten councils labelled the worst performing in England.

Some council chiefs believe the Audit Commission had been pressured by the Chancellor to make tougher judgements on local authorities. But the commission did find the Tory-run shire counties, which ministers want to abolish, were more efficient than smaller 'unitary' authorities favoured by the Government. Eric Pickles, the government spokesman, said: 'The shires are among some of the best performing councils, which makes the desire to abolish them all the more bemusing.' Christine Melsom of Council Tax protest group Is It Fair? said: 'All councils waste a certain amount of money but I think the majority of the problem stems from the Government and the shortfall in grants they give town halls.'

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

HOW TO... CLAMP DOWN ON COUNCIL TAX DISCOUNT FRAUD

2013-05-30T08:41:00.004+01:00

FIRST PUBLISHED BY: THE GUARDIAN

THE NATIONAL FRAUD AUTHORITY ESTIMATES FRAUDULENT SINGLE PERSON DISCOUNTS COST COUNCILS AND TAXPAYERS £92M A YEAR. SEFTON COUNCIL RECOVERED £300,000 BY WORKING WITH CREDIT AGENCIES

Sefton council reclaim over £300,000 a year in Council Tax by cracking down on residents claiming a single person discount despite sharing a home. Council Tax fraud is estimated to cost councils and taxpayers £130m, of which £92m is undetected single person discount fraud according to the National Fraud Authority. This figure is based on earlier work by the Audit Commission which estimated that the rate of single person fraud totals 4% of Council Tax claims.

Whatever the true figure, it is clear from our experience at Sefton that investigating discount fraud presents a significant opportunity to raise additional funds for local authorities – and can be achieved cheaply and efficiently. Along with many other councils, Sefton has tackled the problem by data matching. As recommended by the Audit Commission, we used external data from credit referencing agencies to check against our own internal data. In Sefton alone, we recovered more than £300,000 owed to us in a single exercise working with both Avarto and Experian. This was £127,000 more than we originally envisaged at the outset and amounts to 4% of all single person claims being cancelled.

Evidence also shows that councils that conduct single person discount checks for the first time stand to gain sizeable cash benefits within only a few months of commencing a programme. At Sefton we worked with the credit agencies to gather advice on compliance and how to communicate with our residents using tried and tested letter campaigns. We adopted a phased approach; the first phase of letters encouraged those no longer entitled to the discount, but whose circumstances had recently changed, to renounce their claim of their own accord. Many people only needed reminding. This also allowed our fraud investigators to treat each case differently, and move more quickly to identify and tackle hardened cases of fraud.

We provided Experian with 25,661 records of people claiming sole occupier status. They returned 3,711 records which showed strong evidence of dual or multiple occupancy. We sent out letters to people whose residency check indicated multiple residents, and those receiving letters were asked to provide details of any adult occupant residing at their address.

As a result, 2,964 customers responded to the letters providing information on changes within their household. A further 894 reminder letters were issued for non-respondents allowing seven days to respond, or lose the entitlement to the discount. During the period of review there have been some enquiries from customers having their discount removed. Although three cases have been referred back to the agencies to check their records, none of the enquiries has resulted in either a formal complaint being raised or an appeal against the cancellation of the discount.

As a result we can claim an additional £308,000 in Council Tax per year – exceeding our project target by £137,000, or 80%. We have also achieved our yearly collection targets for 2011-12, ensuring that the increased debit is converted into additional income for Sefton council and the service’s our residents rely on.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

ELDERLY SNARED BY INTEREST TRAP:

2013-05-29T09:05:00.003+01:00

FIRST PUBLISHED BY: THE IS MONEY

PENSIONERS LOSING RIGHT TO PENSION CREDIT AND COUNCIL TAX BENEFIT BECAUSE OF RATE CUTS

Pensioners on low incomes are losing their entitlement to both Pension Credit and Council Tax Benefit because of the savage interest rate cuts. Many are being left hundreds of pounds a year worse off after the Bank of England base rate was slashed from 5.5 per cent to 2 per cent in 12 months. Huge rises in Council Tax bills have already placed a strain on the budgets of thousands of pensioners.

Protest: Pensioners already face huge increases in Council Tax

When calculating Pension Credit for those still repaying a mortgage, the Government assumes home loan costs are 1.58 percentage points above base rate. Thus as the headline rate of interest has fallen this year, so have allowances to cover mortgage costs. And as a result, because the Government assumes that pensioners now have more disposable income, they lose other benefits, too.

This includes those stuck on fixed-rate deals that have not seen any fall in their repayments. Pension Credit is made up of two parts the first being Guaranteed Credit. This tops up weekly incomes for the over-60s to £124.05 for single people and £189.35 for couples. When calculating these benefits the Government includes all income and takes into account how much is spent on housing costs. Over 65s on low incomes can also qualify for Savings Credit worth up to £19.71 a week for singles and £26.13 for couples. This is designed to reward people for saving.

Those that receive Guaranteed Credit receive the bonus of full Council Tax Benefit from the Government - meaning they don't have to pay Council Tax. But those who receive only Savings Credit get reduced Council Tax benefit. Peter Phillips, 71, and his wife Phyllis, 69, are worse off to the tune of £121.36 a month because of the Government's skewed assumptions. They have a seven-year fixed-rate mortgage at 4.6 per cent, with monthly repayments of £457.

Originally their allowance for housing-cost was £101.14 a week. They were also entitled to 58p a week Guaranteed Credit. Crucially, it also meant they were entitled to the full £26.13 per week Savings Credit - and full Council Tax Benefit. On May 19, 2008, after just one base rate cut, his mortgage rate was assumed to have reduced from 6.83 pc to 6.58 pc. This meant the DWP recalculated their housing costs as £97.44 per week.

In one swoop they lost entitlement to both Guaranteed Credit, because assumed disposable income had pushed them up above the benefits threshold. It also meant a reduction in both their Council Tax Benefit and in Savings Credit of almost £20 a month.

They immediately had to start paying Council Tax of £69 a month.

Mr Phillips, from Stoke-on-Trent, says: 'It's disgraceful that we pensioners are being penalised in this way. I can't afford this.' His latest statement shows his savings credit has plummeted to £13.04 a week, after he was moved on to an assumed rate of 4.58 per cent making him £121.36 a month worse off overall.

Fortunately he should receive compensation for this latest drop in income. Yet sadly he will still be £89 a month worse off because of the earlier rate falls. The Government announced in November that it would freeze the rate at 6.08 per cent for six months to stop more people losing benefits. Any losses to benefits incurred when the base rate fell to 3 per cent in November and the assumed rate fell to 4.58 per cent.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

COUNCIL TAX SNOOPERS COULD SELL YOUR DATA

2013-05-28T09:31:00.003+01:00

FIRST PUBLISHED BY: THIS IS MONEY

THE GOVERNMENT IS CONSIDERING SELLING OFF DETAILED INFORMATION ABOUT PEOPLE'S HOMES GATHERED BY COUNCIL TAX INSPECTORS.

Who is watching YOU?

Officials have discussed plans to sell details about the size and condition of households, the number of bedrooms and parking places --and even whether they contain more than one bath - to insurance and mortgage companies.

The Government has also discussed allowing thepublic access to their neighbours' records. The plan will cause outrage among homeowners and liberty groups already angry at Government plans for a new Council Tax valuation system that would give inspectors the right to enter any home and look for 'improvements' which could be used to increase rateable value. And it comes just months after this newspaper exposed how the DVLA was selling off drivers' personal details to car-clamping firms.

The plan was last night blasted, the Government was forcing people to reveal personal information, then profiting from it. Local Government Minister Eric Pickles said: 'This is just the latest disturbing development in the Government's plans for Council Tax inspections. We've maintained from the start that the collection of such detailed information would create a significant temptation to sell it off. The Government should be protecting people, not exploiting them.'

The proposed information sell-offfollows the Government's decision to purchase an American ' computer-assisted mass appraisal' system, which allows tax assessors to pinpoint households on a computerised map and list information gleaned from house-to-house inspections. It will include details of home improvements, number of rooms and their sizes, gardens and even views. The programme then calculates the Council Tax. The £45m database - the largest of its kind in the world --was bought from American firm Cole Layer Trundle.

Patrick O'Connor, who set up the database, said British officials had been 'very interested' in marketing the information. He revealed that he had discussed the proposals with a senior civil servant responsible for tax revaluation. 'I think he is very interested,' said Mr O'Connor, who explained that selling the information would help cover the cost of the revaluation. 'If they could sell the data, they could supplement the cost,' he said.

Mr O'Connor added that there was 'quite a bit of money' to be made. 'In Ontario they have been selling verification of an address and improvements for £2.30 a hit. They could make real money.' The new database, was initially meant only for Council Tax purposes but it has already been extended to cover capital gains tax and inheritance tax.

Last week a delegation from the Valuation Agency Office, including Mr Brankin, revealed the scale of the project to a conference held in Disneyland, Florida. Mr Brankin admitted his team of 13,000 staff had already valued more than ten million properties at a cost of 'hundreds of millions of pounds'. He said the country had been split into 10,000 'localities', allowing assessors to take into account the quality of the area for the first time.

A VAO spokesman said: 'There are no active discussions about whether we will market the information. We don't even know that the revaluation will take place.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

SOUTH 'WORST HIT BY BIG COUNCIL TAX RISES'

2013-05-27T09:24:00.000+01:00

FIRST PUBLISHED BY: THE IS MONEY

COUNCIL TAX HAS RISEN UP TO THREE TIMES FASTER IN THE SOUTH THAN IN THE NORTHERN TOWNS.

In the most tightly squeezed cities and districts - mainly Conservative controlled areas - the Council Tax burden has gone up by more than 150% in a decade. But the most favoured cities have seen the tax they pay go up by only 50% since the party came to power in 1997.

The breakdown comes from figures disclosed by ministers in parliamentary questions, which show how much money has been collected by different town halls. Lowest increases in Council Tax receipts have come in Liverpool, where the take went up just 49% between 1997 and 2007.

Redcar in the North East, St Helens on Merseyside, and Tameside in Manchester also received low amounts of extra tax from their residents. But other places saw comparatively huge amounts of money handed over to town halls. In the City of London, receipts rose by 206%. Outside London there were increases above 150% in parts of Cambridgeshire and Devon. A string of councils saw their collection level go up by more than 140%

Labour has been accused of giving extra subsidies and grants to northern towns and cities, which allow them to keep local taxes down. Tories, who obtained the information through Westminster questions, said yesterday that Labour has been favouring its own voters. Local Government Secretary Eric Pickles said: 'Everyone has faced soaring levels of Council Tax, with homes across the South and East Anglia being clobbered the most.

'The police levy on Council Tax is going through the roof, but police numbers are being cut. Local services like weekly rubbish collections are slowly being cut, while bills rise year on year. People are paying more and getting less.' The: Is It Fair? Council Tax protest group, said: 'If you live in the country, prices are much higher and you get squeezed every time. Council Tax bills are just part of the pattern.'

The evidence of differentials between towns and country and the North and South is likely to become a key campaigning issue in the local elections at the beginning of May. An increase of 140% would mean Council Tax receipts went up by more than ten times the level of inflation. According to the Government the preferred measure, the consumer prices index, inflation went up by 14% between. Last year, research showed that taxpayers in the South are effectively subsidising higher public spending.

Two reports found that the South-East bankrolls the rest of the country but gets fewer policemen, worse health services and shabbier care for the elderly than anywhere else. Studies by the consultancy firms Local Government Futures and Oxford Economics showed that each person in the South East pays the Treasury nearly £2,000 more than they receive back in public spending on services such as schools, hospitals and infrastructure projects.

Under the new system of judging what Treasury grants should be paid to local authorities, councils in areas judged poor and needy have been getting much higher amounts.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

A £136M APARTMENT, BUT THE COUNCIL TAX IS BELOW THE NATIONAL AVERAGE

2013-05-26T08:34:00.002+01:00

FIRST PUBLISHED BY: THIS IS MONEY

THE RICH GET RICHER

Owners of apartments in the luxury One Hyde Park development in central London the most expensive of which sold for £136 million to Ukrainian mining tycoon Rinat Akhmetov will pay just £755.60 in Council Tax to Westminster Council for the year 2011-12.

Residents will pay an extra £619.64 to the Greater London Authority, but the total annual charge of £1,375.24 will still be less than the average tax paid on a band D property in Britain. This is £1,397.51, according to figures compiled by public sector accountancy group CIPFA.

Westminster Council's Labour opposition leader Paul Dimoldenberg said: 'It's extremely unfair that some of the wealthiest people in the world should pay below average Council Tax.' Luxury: The total annual charge will be less than the average band D property. The Liberal Democrats have suggested that the most valuable properties should be subject to a separate 'mansion tax'.

Westminster's charges are low because the council raises £50 million a year in West End parking charges. Its Council Tax is the second-lowest in Britain after Wandsworth, in south-west London. Westminster council leader Colin Barrow said: 'We have frozen Council Tax for the past four years, putting money back into local households.'

He added that the council was getting more cash from the block now that it was residential rather than an office space, since business rates go largely towards central government. The Candy brothers, who developed One Hyde Park, said that some residents have already moved in, contrary to suggestions from Westminster Council that nobody was living there yet. Most buyers own their flats through offshore company structures, allowing them to avoid stamp duty.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

INFLATION-BUSTING COUNCIL TAX RISES AHEAD

2013-05-25T09:58:00.001+01:00

FIRST PUBLISHED BY: THE IS MONEY

COUNCIL TAX BILLS WILL GO UP BY MORE THAN 4% THIS YEAR, IT EMERGED YESTERDAY.

The rise, which is 50% above the rate of inflation, will mean that local taxes will have all but doubled. Local government officials confirmed yesterday that estimates putting the spring increase at less than 4% were too low. Ministers had hoped that large dollops of Treasury cash given to councils had kept the lid on increases.

Town halls last night blamed the Government for the impending hike and one official warned: 'There will be more pain than people had anticipated.'

Lord Bruce-Lockhart, head of the Local Government Association, said: 'Government grants have failed to keep pace with the demands placed on local government, including coping with the needs of an ageing population and the costs from new legislation. 'Now is the time for Government to be honest about what it is prepared to fund in the future and what impact this will have on local services and the Council Tax payer.'

The Department of Communities and Local Government is expected to announce a figure of 4.2% at the end of next month. The Chancellor favoured measure of inflation, the consumer price index, stood at 2.7% in January. An average bill in England would go up by £44 to £1,100. In 1997 the figure was £564.

The benchmark band D Council Taxpayer would have to find £1,321, up by £53 and, over the decade, a 92% increase. The elderly have suffered the most from higher bills, largely because many have good-sized homes in highly-taxed areas while having to make do on fixed incomes.

Two supporters of the pressure group Is It Fair will be in court this week for non-payment of Council Tax.

Spokesman Christine Melsom said: 'Once again the Council Tax rise will be order to meet Council Tax demands. One in 12 had cut back on heating. Charity finance expert Anna Pearson said: 'This injustice is made worse by the fact that despite the increases in Council Tax, many older people are seeing the services they rely on most facing cutbacks.'

Tory local government spokesman Caroline Spelman said: 'Council Tax bills are now edging closer and closer to being double what they were when Labour came into power and every year brings a nasty shock as higher and higher bills arrive. 'An increase of 4.2% is the equivalent of £110 a month out of someone's pension or take-home pay.'

The property revaluation could leave many owners paying even more in Council Taxes. A report into local government finances is due this spring.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

GREEN PROPOSES COUNCIL TAX RISE ‘FOR TOUGH TIMES

2013-05-24T13:23:00.000+01:00

FIRST PUBLISHED BY: THE ORACLE

GREEN PARTY LEADER ROB WHITE ASTONISHED FELLOW COUNCILLORS ON MONDAY BY CALLING ON THEM TO PUT UP COUNCIL TAX.

The minority Labour administration is proposing a zero Council Tax increase, but needs the support of one of the other parties for it to be passed. Cllr White cast aside the tradition which puts off debate on the budget to the full council meeting – this year on Tuesday, February 21.

Leader of the council Jo Lovelock was reluctant to call on him to speak at the cabinet meeting, citing “tradition” and the need to avoid debating the budget twice. Promising he would only take a minute, Cllr White pressed on, saying these were “extraordinary times”. He described the £3.4 million grant from Government to pay for the Council Tax freeze as a “bribe”.

He proposed a 3.5 per cent increase in Council Tax, which would cost each household 87p a week. After the meeting Cllr White acknowledged his proposal might not be much of a vote winner “but it is the right thing to do”. He explained his thinking, quoting from a consultation document produced by the council’s education and children’s services department:

“We need a fair budget for tough times".

The council is facing unprecedented cuts to its funding and is proposing to reduce services and cut staff in areas such as special needs transport, learning disability support and respite care. “In the staff consultation, learning difficulties managers said that ‘the service level cannot be maintained’.

“In school improvement, responses included that cuts would ‘push work from the administration staff to others’, overloading them. “In safeguarding, officers said ‘there is no longer capacity to provide effective maternity and sickness cover’ and most worryingly of all is that the good work completed since the service was deemed inadequate in 2008 ‘will be lost’.

“We think that this is unfair, unacceptable and as we said in our manifesto last year, we think public services are important and we will defend them. “For 87p per week – not per head, but per household – it is possible to limit this damage in the coming budget and to avoid finding ourselves in a massive hole next year.”

He continued: “We understand these are difficult economic times and so we feel that an increase in Council Tax has to be modest and below inflation. “This applies not just this year, but next year too, whereas a freeze this year would need a massive hike next year to make up lost income.

“This will also allow us to defend jobs and support the local economy. “Twenty-seven councils around the country, including 11 which are Conservative controlled, as well as the Greens in Brighton, are also raising Council Tax instead of taking the one-off freeze money. “We want Reading councillors to consider this option.” The budget contains cuts and increased fees totalling £12.6 million and the loss of around 30 posts.

If the Greens do not support the Labour administration, the ruling group will have to look to either the Liberal Democrats or the Tories for support. Cllr Lovelock said yesterday she had so far arranged meetings with Cllrs White and Daisy Benson, the leader of the Lib Dems, to discuss the budget before next week’s meeting.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

CALL FOR CLARITY ON COUNCIL TAX 'CONFUSION'

2013-05-23T07:17:00.003+01:00

FIRST PUBLISHED BY: LOCAL GOVERNMENT CHRONICLES

OFFICIAL GUIDANCE ON COUNCIL TAX REFERENDUM

Calculations have been described as “confusing” and ministers have been asked to issue a clarification. Some finance directors have warned the new rules on Council Tax could see authorities trigger a referendum even if they put up Council Tax by less than 3.5%.

The issue centres on the government’s decision to calculate increases based on the “relevant basic amount of Council Tax”, which excludes from the Council Tax requirement the ‘levies’ councils pay to outside bodies such as the Environment Agency or the London Pension Fund Authority, rather than “basic amount of Council Tax”, which is the amount charged to residents of the borough.

The LGA’s Special Interest Group of Metropolitan Authorities has suggested that the approach which is a complete change on previous the previous method of calculating tax rises – could hit councils with larger levy payments than others, such as those who have set up joint delivery bodies with neighbours for services such as transport and waste.

Sefton and St Helens MBCs, which both pay a levy to the Merseyside Waste Disposal Authority, have calculated they would trigger a referendum with increases of around 2% while Tonbridge & Malling BC have calculated their trigger point would be “a fraction over 2.9%” because of drainage board levies. “We have been to DCLG about it and we got what I see as a rather confusing answer from them,” Stephen Jones, the LGA’s head of finance, said.

Former local government minister John Healey has called on Mr Pickles to clarify how the referendum system is to work. “The new system is beset by confusion and uncertainty. A clear public statement of the way the system works is essential and urgent,” he said. “In practice the trigger point for a referendum will not be 3.5%, it is likely to be lower and to be different in every local authority,” he said.

At a conference last month, Steve Freer, chief executive of the Chartered Institute of Public Finance and Accountancy, said the levies problem “just demonstrates how complicated and complex” the situation is. However, the body believes the exclusion of levies is the right approach in order to avoid councils triggering a referendum simply because a levying body increased its charge.

DCLG argues the removal of levies from the calculation is justified because a reduction in any levy on a council should be passed on to Council Tax payers. In effect, this means that councils which experience a reduction in levy payments cannot chose to reinvest that saving in services without it lowering the amount by which it can raise its Council Tax.

In a letter to Mr Healey, housing minister Grant Shapps wrote: “If, instead of taking the burden of a levy off taxpayers when that levy is reduced, an authority chooses to increase its own expenditure to “soak up the slack”….a referendum would then be required, and I am entirely happy that this outcome is justified.”

DCLG has also sent councils a note warning them to check their calculations carefully: “Authorities which are planning a Council Tax increase just below the [threshold] should take care to ensure that they do not inadvertently increase their relevant basic amount of Council Tax by marginally more this level.”

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

YVONNE FOVARGUE MP

2013-05-22T09:29:00.003+01:00

FIRST PUBLISHED BY: PARLIAMENTARY COMMUNICATIONS LTD

COUNCIL TAX CHANGES WILL HIT THE WORKING POOR

The government's proposal to localise Council Tax benefit (CTB) while cutting funding by 10 per cent will hit hardest the working poor, writes Yvonne Fovargue MP. This reform is part of the decentralisation agenda and its aim is to create stronger incentives for councils to get people back into work and so support the work incentives that will be introduced through the government's plans on universal credit.

The communities and local government select committee expressed scepticism over the level of local control that councils will actually have saying, 'the proposals for the localisation of Council Tax support seem to us to provide an illusion of delegation with a minimum of real discretion, virtually guaranteeing that the funds available to support working-age unemployed people will be squeezed'. However, the decision to abolish the national CTB from 2013-2014 and instead provide local councils grants to create their own systems will leave them struggling to design replacement schemes. Government has proscribed that existing and future pensioners are protected at current levels leaving no discretion in this area and in determining a scheme councils must also leave untouched the single persons discount.

Therefore the cash funding cut, which equates to £2.6million for my local authority, Wigan in Greater Manchester will fall onto 18,000 local working-age households, already struggling against a backdrop of the current difficult economic conditions. The 10 per cent cut in the £5bn spent on CTB means that local authorities need flexibility to target support to the poorest and most deserving in society. Government inflexibility poses the danger that those on higher incomes will receive discounts at the expense of the needy.

The timescale to completely redesign the existing scheme, consult, agree, put in place the administrative process and ensure that IT can deliver the scheme is very tight. Existing working age customers receiving CTB will see a reduction in amounts awarded – before any protection is applied for locally defined vulnerable groups. There is a potential for reductions in collection rates for Council Tax – Council Tax will need to be collected from customers who are receiving a decrease in their existing Council Tax benefit – this could be the first time that some people have had any liability to pay. Collection could be difficult and involve high levels of direct contact to recover the debt.

This change compounds the effect of other welfare reforms. Households renting in the private sector will have seen a reduction in their housing benefit by December 2012. There are further reforms to housing benefit due in the social sector in April 2013. Local authorities will have to design schemes where very difficult decisions will have to be taken about caps on entitlement, minimum awards, amended capital limits and income tapers and even changes to disregarded income (child benefit, war pensions), or find money from within existing resources to plug the shortfall – politically difficult and at odds with child poverty strategies.

Hard working families are already squeezed, councils are squeezed and it is inevitable that, yet again, the poor and vulnerable will suffer at the hands of this government.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

NEW PROPOSALS MEANS SOME KINGSTON RESIDENTS COULD BE FORCED TO COUGH UP MORE COUNCIL TAX

2013-05-21T10:25:00.002+01:00

FIRST PUBLISHED BY: THIS IS LOCAL LONDON

COUGH UP MORE COUNCIL TAX UNDER NEW PROPOSALS

Landlords, second home owners and more than 400 residents of working age could be forced to cough up more Council Tax under new proposals. Kingston Council’s new Council Tax benefit scheme aims to charge higher rates to those who can afford it, while protecting the elderly, disabled and vulnerable in a bid to make up a £1m shortfall.

The deficit comes after central Government decided to abolish the national Council Tax benefit scheme and cut funding by 10 per cent by April 1 next year, leaving the local authority in the lurch. Currently 9,600 Kingston residents are claimants of Council Tax benefit, that is means tested and helps people with low or no income to pay their Council Tax.

The plans aim to encourage people to work by rewarding those who do, while still protecting people on low incomes who are already struggling to make ends meet.Under the new scheme £100,000 will come from 400 people of working age who live with other working adults and will be asked to contribute more. The rest of the shortfall will be met by removing Council Tax exemptions and discounts on certain properties, including those that are not occupied as a main home. An empty homes premium of 50 per cent will also be charged on properties left empty for more than two years.

Councillor Rolson Davies, lead member for finance and resources, said: “We understand that our proposals will not be popular with those who we would be asking to pay more, but we have a responsibility to protect those who are vulnerable, including those people relying on our frontline services.” Tenants may have to pick up the shortfall after changes to Council Tax benefits, according to Chris Norris, head of policy at the National Landlords Association (NLA).

However, Mr Norris said good communication with both groups and the council could minimise any negative effect. He said: “Landlords will be keen to sustain long-lasting tenancies, so it is important that tenants and landlords work together to agree the best way to continue rent payments and sustain their tenancies.”

Pippa Mackie, chief executive of Kingston citizens advice bureau, said one problem area could be for former owners of repossessed houses, as building societies will be taxed after repossession and they could try and pass the cost on. She said: “I think that most people who are reliant on welfare benefit are concerned about the impact that changes might have on them. “There are going to be changes which may cause confusion so we will be working to make sure that as much information as possible is out there.” People who are of pension credit age or who are receiving a disability related benefit will not be affected by the changes.

A consultation on the proposed changes will start on July 2 and run until September 9, before being considered by the council’s policy and resources committee and full council in December.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

LGA DEMANDS CONTROL OVER COUNCIL TAX RULES

2013-05-20T08:54:00.002+01:00

FIRST PUBLISHED BY: LOCAL GOVERNMENT CHRONICLES

THE GOVERNMENT MUST SCRAP BLANKET COUNCIL TAX DISCOUNTS OR THE POOREST WILL FACE HUGE BILLS.

That warning has come from the Local Government Association, which said more than two million people who are either low earners or young and unemployed could have to pay an average of £247more in Council Tax each year. Control of entitlement to the benefit is due to pass to councils next year. But the government will impose a £500m cut, equivalent to 10% of the total available.

And it has ordered that discounts cannot be reduced for single people regardless of income or for currently eligible pensioners, as well as suggesting that vulnerable groups such as families with children should be protected from any reductions. Ministers have claimed that councils could make up the shortfall by cutting discounts for second homes and empty properties.

But LGA chair Sir Merrick Cockell (Con) rejected this: “The poorest regions and the most vulnerable people will be hardest hit by this cut unless the government offers councils more flexibility over all forms of Council Tax discount. “It is the only way that councils can ensure that the greatly reduced funding for Council Tax benefit is targeted at the local people who need it most.” Without this, the £500m cut would prove “impossible to deliver” except through service cuts, higher overall tax rates or the higher charge for working poor people and the young unemployed, he warned. Sir Merrick added: “The Treasury has made the cut and left councils to make incredibly tough decisions and face the inevitable fallout.”

The LGA arrived at its £247 figure by taking Department for Work and Pensions statistics, published only at UK level, which show 5.9 million Council Tax benefit recipients, of whom 2.2 million are aged 65 or over and 1.7 million are families with children. The first group must be protected, and it has assumed that councils would wish to protect the second, leaving 2.0 million working age benefit recipients to share the £500m cut, an average of £247 each. For England, the figure would be roughly £210. David Magor, chief executive of the Institute of Revenues, Rating and Valuation, said: “The shortfall in England will be £437m, and the government has said second and empty home discounts could be worth some £420m. “The trouble with that is that it is ‘lumpy’ at local level. If you have not got many second homes you will have to cover the gap from something else.”

Councils in places such as the south west, with both low income levels and high numbers of holiday homes, might make the equation work, but those in older industrial areas could struggle, he said. Local government minister Bob Neill said: “The government has no intention of letting councils abolish vital discounts like those for single person homes.

“Spending on Council Tax benefit has more than doubled since 1997. The Local Government Association needs to realise that councils accounts for a quarter of all public expenditure and they need to play their part in tackling the deficit.” He added: “We are giving councils a strong incentive to put in place a better and fairer local Council Tax support scheme based on local priorities that means they can help more residents get back into employment, protect the vulnerable and reduce the spiralling benefits bill.”

The Local Government Finance Bill, which would give effect to the changes in Council Tax benefit, is due for debate in the House of Lords this evening.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

£2BILLION OF COUNCIL TAX LEFT UNCOLLECTED BY TOWN HALLS WHO THEN MOAN ABOUT CUTS BY WHITEHALL

2013-05-19T09:58:00.003+01:00

FIRST PUBLISHED BY: THE MAIL ONLINE

COUNCILS IN ENGLAND HAVE FAILED TO COLLECT BILLIONS IN COUNCIL TAX – WHILE COMPLAINING ABOUT CUTS TO THEIR BUDGETS FROM WHITEHALL.

The total arrears – much dating back several years – is spread across 31 local authorities and stands at £2.3billion. Eight out of the ten councils with the worst record on collecting Council Tax are Labour-run. Liverpool had the highest amount of arrears, with nearly£108million in Council Tax outstanding – about £500 per household in the city.

Biggest debts: Liverpool City Council is owed £108million in unpaid Council Tax. Earlier this year, the city’s Labour leader Joe Anderson said he was ‘so angry and so devastated’ that the council had to find £91million in savings.

That amount is less than the total in uncollected Council Tax. 'Angry': Liverpool's Mayor Joe Anderson was 'devastated' the council had to make savings in other areas to make up the shortfall. Manchester’s plans to cut services were criticised last year by David Cameron when he told the Labour-run local authority it should first cut its chief executive’s £200,000 salary. Labour regained control of Birmingham from the Tories and Lib-Dems in May and Croydon, also among the ten with the worst record, is controlled by the Tories. Local government minister Bob Neill unveiled the figures in a parliamentary answer to Labour MP Helen Jones. He said: ‘Every penny of Council Tax that is not collected means a higher Council Tax for the law-abiding citizen who does pay on time.

‘These figures show that there is a significant source of income which councils could use to support front-line service or cut Council Tax bills.’ Lambeth, which has £48million of uncollected Council Tax, last year used taxpayers’ money to fund a poster campaign complaining about central government spending cuts. The posters said: ‘The Government has cut our money so we are forced to cut services.’ The Government has ordered a freeze of Council Tax across the country and has refused to pour in more cash to profligate councils.

'Shameful': Secretary of State for Communities and Local Government Eric Pickles accused local authorities of squandering millions by failing to collect Council Tax Local authorities have also expressed outrage over the Government’s 28 per cent cut to their funding. But Local Government and Communities Secretary Eric Pickles yesterday hit back, saying: ‘This roll call of shame is familiar reading, with Labour councils year in year out topping the table of local authorities who squander millions by failing to collect our Council Tax.

‘If these Labour authorities stopped complaining about the legacy of cuts left by their own party and actually chased up Council Tax dodgers they could use the money to protect hundreds of front-line jobs.’ The worst collection rate in England for last year was the London borough of Newham, where 8.3 per cent of Council Tax was not paid. It was followed by Manchester, Salford and the London boroughs of Southwark, and Barking and Dagenham. In total, £612million of Council Tax was not collected in 2010-11 across England.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

TREASURY LOOKS AT 'SUPER COUNCIL TAX' TO FORCE MULTI-MILLIONAIRES PAY MORE FOR THEIR PROPERTIES

2013-05-18T13:12:00.003+01:00

FIRST PUBLISHED BY: THIS IS MONEY

THE CHANCELLOR COULD IMPOSE SUPER COUNCIL TAX BANDS ABOVE BAND H TO FORCE THE WEALTHIEST TO PAY MORE FOR THEIR PROPERTIES.

The Chancellor could impose super Council Tax bands

The Chancellor is considering slapping taxes on expensive houses in a deal with Lib Dems that would also relax employment laws for small business. George Osborne is examining proposals to impose super Council Tax bands above the current band H in order to force the wealthiest to pay more for their properties. The plans, which are being discussed by the Quad of ministers drawing up the Budget, would be a victory for the Liberal Democrats, who have campaigned for a mansion tax on properties worth more than £2million.

But in return, Nick Clegg and his party have indicated they are prepared to sanction Tory plans to tear up some employment rights in order to encourage firms to hire staff. Senior Lib Dem sources say the Deputy Prime Minister will back proposals in the Beecroft Report on regulation which would give greater freedoms to micro-firms employing fewer than ten people. Under the plans, small companies employing people under the age of 25 would not have to give them full employment rights for a fixed period of time.

Tories, including Local Government Secretary Eric Pickles, have opposed any change in Council Tax bands because they feared it would lead to an expensive and controversial revaluation of all homes in Britain. But some Conservatives now believe that would not be necessary and that bands I and J – designed to hit multi-millionaires in London – could be imposed on homes based on the last valuation in April 1991.

Mr Clegg argued last month that it is wrong that someone with a house in Band H – which kicks in at properties worth £320,000 in 1991 – pays the same as someone with a home worth several million pounds. A Government source said: ‘Treasury orthodoxy favours taxing assets that cannot be hidden or moved. Even the best accountant in the world cannot hide a house from the tax man.’

Deputy Prime Minister Nick Clegg has argued that new tax bands I and J would hit multi-millionaires in London. The Beecroft Report, drawn up by venture capitalist Adrian Beecroft last autumn, has never been published after the Lib Dems condemned its call for ‘fire at will’ legislation that would have allowed bosses to sack staff without an industrial tribunal. Mr Clegg’s party is prepared to help get its way on property taxes after Mr Osborne came under pressure from backbenchers to back supply side reforms to boost business and jobs.

Former Cabinet minister Liam Fox yesterday stepped up that campaign, saying: ‘Political objections must be put aside. ‘It is too difficult to hire and fire and too expensive to take on new employees.’ Asked if the Lib Dems would support plans to suspend some workplace rights for under 25s – to encourage the hiring young unemployed people – a source said: ‘The devil is in the detail but it’s not something where the starting point of view is hostile.’

Lib Dems point out Business Secretary Vince Cable has doubled to two years the length of time someone must work before they are entitled to basic rights. A Treasury spokesman said the issue of mansion tax ‘comes up every year and it is speculation’.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

GOVERNMENT RULES OUT ENGLISH COUNCIL TAX REVALUATION

2013-05-17T10:48:00.002+01:00

FIRST PUBLISHED BY: BBC

COUNCIL TAX BANDS IN ENGLAND HAVE NOT BEEN REVALUED FOR 17 YEARS

There will be no revaluation of Council Tax bands in England during this Parliament, the government has pledged. It means there will be no rise in local taxes for householders based solely on the increased value of their homes. Every property in England is in one of eight Council Tax bands, depending on value, and these were last set in 1993. The government said Labour had been "actively planning" to carry out a revaluation but Labour said its election manifesto had promised not to.

'Financial worries'

A revaluation was long overdue, but would prove highly unpopular with householders who found themselves in a higher band and therefore paying more in Council Tax, said the BBC's Greg Wood. A revaluation in Wales in 2005 placed about a third of all homes there in a higher band. The government says that a rise from Band D - the benchmark for Council Tax - to Band E would cost an extra £320-a-year. The former Labour government had planned to revalue Council Tax bands in England in 2007, but announced in 2005 that it would postpone the decision until after the next general election.

It said the delay was to allow the issue to be considered as part of a wider inquiry into local authority funding, but some commentators said at the time that the decision was also a reaction to the anger sparked by the Welsh revaluation. Local Government Secretary Eric Pickles said the key thing was the relationship between the upper and lower bands of the tax, and they were roughly the same as when the tax was introduced.

"I've always argued against a revaluation because we know from what happened in Wales that it tends to hit poorer families. Given that the bands are roughly in the same position as when Council Tax was first introduced then it seems to me to be a matter of fairness that we don't impose an additional level of taxation, £1,600 during this Parliament, on ordinary families."

But a Labour spokesman said: "The Labour Party made an unequivocal commitment that there would be no Council Tax revaluation in this Parliament. "This is a cynical and misleading manipulation of facts based on what was ultimately a routine updating of the Valuation Office Agency's records." The Taxpayers' Alliance, which campaigns for lower taxes, said families would be relieved there was to be no revaluation. "Council Tax has doubled in the last 10 years while many services have been scaled back, executive pay has spiralled out of control and charges have increased; it's time Council Tax was cut," spokesman Emma Boon said.

"What's been happening is that where local councils have looked at trying to find other ways of charging people, it's just simply meant other taxes... charging people for throwing away more rubbish or fining people and things like that." Colin Barrow, leader of Westminster City Council, said councils would welcome the move as a "positive step" that would "end uncertainty" for many Council Tax payers and local authorities.

"It allows the government to concentrate on creating a fairer and more responsive financial system, reflecting the differing needs of each area. "We, for instance, would refer to the special problems of poverty in Westminster alongside the responsibility we have to keep the city clean for millions of visitors every day," he said. What band a house falls into is determined by inspectors from the government's Valuation Office Agency (VOA). There has been criticism in the past from some quarters over what data about people's homes is collected and kept by the VOA.

Mr Pickles said the government was moving to address this issue, and that an independent data audit of the VOA would protect privacy and civil liberties as part of dismantling the "database state". The Scottish Parliament has no plans to revalue homes in the foreseeable future. In Northern Ireland, which has a different system of local taxes, property values were reassessed in 2005.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

WAS IT COINCIDENCE THAT I GOT A MESSAGE FROM A FIRM I OWE MONEY SOON AFTER I MISSED MY COUNCIL TAX PAYMENT?

2013-05-16T07:50:00.002+01:00

FIRST PUBLISHED BY: THIS IS MONEY

TIMELY TEXT: WAS IT A COINCIDENCE THAT I GOT A TEXT MESSAGE FROM A CREDITOR URGING ME TO GET IN TOUCH A WEEK AFTER I MISSED A COUNCIL PAYMENT?

I had a text on my mobile phone out of the blue from a creditor urging me to get in touch if I was experiencing financially difficulties just a week after missing a Council Tax payment. Do banks/mortgage lenders or even the councils send out advisories as to who might be struggling financially? If so isn't this a breach of confidentially? It doesn't feel like a coincidence as I have never missed a payment and the creditor has a secured loan i.e a second charge on my property.

Linda Mckay of This is Money replies: Struggling borrowers such as yourself who are juggling many different debts including a mortgage, second charge or credit cards may have trouble in meeting all the demands of creditors. Can creditors spot financial difficulty and if so how? I asked experts in the field for you. Joanna Elson OBE, chief executive of the Money Advice Trust replies: The crucial issue here is whether or not this is a creditor through which you pay your Council Tax. If they are not, then something may be amiss and a breach of confidentiality under the Data Protection Act is worth exploring.

In this case the first thing to do is to write to the creditor and ask what information they used to identify your supposed financial difficulty. A missed Council Tax payment may show on your credit file, and so a creditor could possibly spot this while carrying out a genuine check on your file. However, if this is the case you should ask the creditor to justify why they were looking at your file, as creditors can’t simply do so on a whim. Alternatively it may have been a phishing text with coincidental timing.

However, if this is a creditor through which you pay your Council Tax, then there has been no breach. Indeed we encourage creditors to proactively contact customers they identify as being at risk of financial difficulty. Of course much of our support for such practices depends on the nature of how the creditor contacts such an individual and what advice they provide.

For example if a creditor notices an individual frequently incurring charges for dipping into an unauthorised overdraft and they then contact that person to signpost them to relevant sources of free debt advice, such as National Debtline, My Money Steps or Citizens Advice, the person may be able to resolve their financial situation more quickly and less painfully than might have been the case had the creditor simply ignored the issue and continued collecting overdraft fees and charges.

We conducted research into the merits of proactive contact with struggling borrowers last year, and found that the results of these practices were overwhelmingly positive, with people resolving their financial problems before they became particularly serious. Anyone who is struggling with their finances is likely to find a far better outcome the earlier they start to deal with their problem, and the first step is to seek free, independent advice.

James Jones, of leading credit agency Experian replies: Councils do not share data about Council Tax payments with lenders through the credit reference agencies (CRAs), so the text from your mobile phone provider will not be because you missed a Council Tax payment. Many lenders that do share credit data through the CRAs do get your permission to consult it on a regular basis. If, while doing this, they spot a missed payment elsewhere or simply that your overall financial situation is deteriorating, they may take action such as getting in touch to offer help.

If you’re concerned about the information on your credit report, it’s easy to get hold of a copy. If you do this and find a mistake you can make sure it is corrected. You can also use a ‘notice of correction’ to explain the reasons for any correct missed payments or other adverse information in the past.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

70,000 HOMES 'FACING COUNCIL TAX HIKE'

2013-05-15T08:22:00.003+01:00

FIRST PUBLISHED BY: THIS IS MONEY

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.

Critics claimed it was evidence that every home-owner 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.

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

COUNCIL TAX COULD RISE TO EASE BENEFITS CUTS

2013-05-14T07:00:00.003+01:00

FIRST PUBLISHED BY: THE TELEGRAPH

WORKING FAMILIES FACE INCREASES IN THEIR COUNCIL TAX BILLS TO PROTECT BENEFITS CLAIMANTS FROM CUTS IN WELFARE SPENDING, ECONOMISTS AND COUNCIL LEADERS HAVE WARNED.

Coalition plans to make local authorities set their own rules for Council Tax benefit could also undermine the Government’s plans for welfare reform, it was suggested yesterday. The Institute for Fiscal Studies analysed Coalition plans to reform the rules for Council Tax benefit and identified a number of potentially serious problems.

Next year, the Government is planning to scrap the national system of Council Tax benefit, which gives discounts on the tax for low-income households including the unemployed.

Under the new system, local authorities will be given control of money for Council Tax benefit. The sum available for the benefit will also be cut by 10 per cent. Because Council Tax benefit for pensioners is protected, that cut could mean much larger reductions in areas with large numbers of retired residents.

In parts of Dorset and Yorkshire, for example, working-age claimants would face a 33 per cent cut in Council Tax benefit. The IFS said the 10 per cent cut would leave councils facing a choice between making significant cuts in benefit for working-age households and finding the money elsewhere, either by cutting services or increasing tax. Scotland’s devolved administration has taken the choice to find the money elsewhere, to avoid major cuts in benefit payments.

The IFS calculated that the average English local authority choosing to do the same would either have to cut spending on other services by 0.4 per cent, or increase Council Tax by 1.9 per cent. Sir Merrick Cockell, chairman of the Local Government Association, said that councils are being put in an impossible position and may have to increase taxes.

"Councils are extremely worried about how they're going to protect deserving and vulnerable people from the £500 million cut to Council Tax benefit next year,” he said. “They can either cease helping the working poor, or continue to support them by taking money from other services or putting up Council Tax.” In a report on the Council Tax benefit reform, the IFS suggested that a localised benefit regime could “undermine” the Coalition’s flagship Universal Credit welfare reform.

Universal Credit, due to begin next year, is meant to integrate all benefits into a single system, and ensure that people claimants are always better off if they take paid work. However, Council Tax benefit has been left out of the new system, and the IFS warned that trying to co-ordinate the local and national benefits system would be complex and possibly damaging.

Depending on how councils design their welfare rules, the effect could be to “reintroduce some of the extremely weak work incentives that Universal Credit was supposed to eliminate.” Overall, the IFS concluded, the localisation of Council Tax benefit “has the potential to undermine many of the positive impacts of Universal Credit.”

Bob Neill, the local government minister, said that the Government's reforms were right. He said: "It is right that local authorities, who collect Council Tax, have a strong incentive to put in place a fairer local Council Tax support scheme that helps their residents get back into employment based on local priorities."

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?

COUNCIL TAX BILLS COULD LEAP TO FUND £54BN PENSION DEFICIT 'TICKING TIME-BOMB'

2013-05-13T06:17:00.000+01:00

FIRST PUBLISHED BY: THIS IS MONEY

EXPERTS WARN COUNCIL BILLS WILL HAVE TO RISE SHARPLY IN THE FUTURE TO PAY FOR PENSIONS PAID TO COUNCIL WORKERS, FROM BIN MEN TO TOWN HALL STAFF.

Britain is sitting on ‘a ticking time bomb’ created by the generous pensions enjoyed by council workers, the report warns today. The shocking analysis reveals councils across the UK have a pensions deficit of £54billion – amid warnings it could get even bigger. Warning: Council Tax bills will have to rise sharply to pay for council workers' pensions, experts believe. The equivalent of around £1 in every £5 of Council Tax is already spent on local authorities’ contributions to their workers’ pension scheme, according to the report by campaign group the TaxPayers’ Alliance.

The average pension paid to a council worker is around £4,200 a year, which covers all council workers, many of whom are on very low pay. But more than 2,700 scoop pensions worth at least £37,000 a year and more than 35,000 get at least £17,000 a year, according to official figures. By comparison, most private sector workers do not have a pension – and it is worth only £1,400 a year to those who do.

More...

IMF warns Britain may need to raise retirement age faster to avoid a debt spiral. Pensioners who saved diligently for years to see payout income slashed by up to 60% Matthew Sinclair, a director of the TaxPayers’ Alliance, said: ‘The deficit remains a ticking time bomb that is being left for future generations of taxpayers to deal with. ‘With an ageing population and a crisis in public finance, generous final salary schemes, like the Local Government Pension Scheme, are inflexible and too expensive and need urgent reform.’ The report, based on official council figures, says the local government pension scheme has assets of £132billion. But the scheme has made pension promises, known as liabilities, of £186billion to its members – leaving the £54billion deficit, according to the 2010/11 figures.

The biggest culprit is Birmingham City Council, with a deficit of £1.33billion – equal to nearly £1,300 for every resident. Overall, the report says there are 165 local authorities with a deficit of more than £100million. Dr Ros Altmann, director general of Saga and a leading pension expert, said: ‘Taxpayers underwrite the deficit. If it does not come down, they will foot the bill. Future taxpayers – our children and our grandchildren – will be on the hook.’ Tom McPhail, head of pensions research at financial advisers Hargreaves Lansdown, said: ‘Local authorities are going to come under pressure to raise Council Tax to fund these pensions. ‘They are going to have to go to taxpayers, who do not have good pensions of their own, to meet their very generous pension promises. That is not going to go down well with people.’

The average Band D Council Tax bill in England is currently £1,444, one of the biggest monthly costs facing most families after their mortgage or rent and food bill. Bob Neill, the minister for local government, said: ‘These pension bills are costing over £300 a year to every family and pensioner paying Council Tax, diverting funds from emptying bins, cleaning the streets and keeping Council Tax down. ‘Hard-pressed taxpayers simply cannot afford to foot an ever-growing bill.’

Local government workers currently get a final salary scheme, retire at 65 and contribute only between 5.5 per cent and 7.5 per cent of their salary. The Government is currently negotiating changes with unions, including a switch to a career average pension and to link retirement age to the rising State pension age. Sir Steve Bullock, chairman of the Local Government Association’s workforce board, said: ‘Presenting a one-day snapshot is a spurious way of gauging the viability of a pension scheme and this year-old figure has no relevance to the actual cost of local government pensions. ‘Councils have taken steps to ensure the schemes, which are significantly funded by contributions from employees, are affordable for taxpayers, fair to workers and viable in the long-term.’

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

ARE YOU PAYING TOO MUCH COUNCIL TAX - CHECK HERE?