The average family in Britain will face inflation-busting council tax rises of more than £100 in April, the Government has announced. Downing Street has confirmed that local authorities will be told they can increase the levy by as much as 5% next year – three times the current rate of inflation.
Across England, the average Band D council tax bill currently stands at £2,171. The Government’s decision means local councils will be able to increase this by up to £109 next year. For those in the most expensive Band H households, last year’s £4,342 bill will rise by £217.
This vast increase, which is three times the 1.7% rate of inflation, comes despite previous claims from Labour’s deputy leader Angela Rayner that council tax would not be rising. The majority of councils will have to implement the maximum increase due to a £2.4 billion shortfall in the funding expected to be required by local authorities to pay for social care and other priorities next year.
In the most expensive area, Rutland, the increases would be even higher: up £127 to £2,670 for Band D and up £254 to £5,340 for Band H.
The Government’s clarification of its council tax policy comes after Sir Keir Starmer was challenged on the issue during Prime Minister’s Questions. When asked by Conservative leader Kemi Badenoch whether the current 5% cap on council tax rises would be maintained, he declined to answer directly.
Ms Badenoch said: “I think the House will have heard that the Prime Minister could neither confirm nor deny whether the cap on council tax was being raised.”
Until the Coalition government was elected in 2010, there were no limitations on council tax rises. But the then-local government secretary Eric Pickles brought in a law telling local authorities they could not increase council tax bills above a certain level without holding a local referendum.
Given that councils know their residents are unlikely to agree to an increase, a local referendum has seldom been called. Last year, under the Conservatives, the council tax cap was set at 5%, but many local authorities, including Conservative-run ones, said they were so short of money that they needed to be able to increase bills by a higher level.
