Council tax to rise by 4.1%

COUNCIL tax will rise by an average of 4.1% from April ? the lowest percentage increase in more than ten years. The bill for two adults living in a Band D property, worth between £66,000 and £88,000, will increase by just £47 to £1,214 in 2005-2006. It is the lowest rise since 1994.

The figure is lower than most experts expected and significantly less than the 5.9% rise suffered by home owners last year.

Councils were warned by Local Government Minister Nick Raynsford not to increase the tax by more than 5% after local authorities were handed a cash boost this year.

Councils will be given more than £60bn in total in 2005-2006 - a 6.3% increase ? while Chancellor Gordon Brown handed over a further £1bn in his Pre-Budget Report.

The tax has become a key pre-election issue, with Labour's rivals accusing the party of keeping council tax down in the run up to the General Election.

Shadow local government secretary Caroline Spelman said: 'Hard working families and pensioners are now paying more than £100 a month in council tax under Tony Blair. 'Across the country, bills have soared by 76% since Labour came to power, despite Mr Blair's promise that he had 'no plans to increase tax at all'. In any third Labour term council tax will soar even more.'

Brown handed pensioners a £200 council tax rebate sweetener in his recent Budget, with the Conservatives responding by offering £500. Liberal Democrats propose replacing council tax with a local income tax.

Figures published earlier this week revealed that local authorities in England failed to collect more than £580m in council taxes in the 2003-2004 financial year.

Birmingham topped the league of authorities failing to collect all the money they were due with £12m remaining outstanding, according to figures compiled by the GMB union.

Other areas that failed to collect the most council tax included the London borough of Hackney, Liverpool and Manchester.

How does your band compare?

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