Households are bracing for extra eye-watering council tax rises subsequent yr after Keir Starmer signalled the cap can be 5 per cent.
Native authorities will be capable of hike payments by practically thrice the present price of inflation after Downing Avenue confirmed the ceiling.
That may very well be equal to a £110 improve on the common Band D property throughout England. Nonetheless, in some areas it will likely be larger in money phrases.
The information is a hammer blow for Brits who’ve been scuffling with the price of residing disaster – and already face being battered by the Funds’s huge tax raid.
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Keir Starmer was embroiled in a row over the cap on council tax yesterday throughout bad-tempered PMQs clashes
A authorities supply mentioned the 5 per cent cap wouldn’t essentially translate into an identical tax rise as it might be ‘as much as particular person councils’ to resolve what to cost.
However most are anticipated to extend payments by the utmost quantity.
Authorities statistics present the common band D council tax set by native authorities in England for 2024/25 was £2,171, which represented a rise of £106 or 5.1 per cent on the earlier yr.
The primary inflation determine fell to 1.7 per cent in September though it’s anticipated to rise once more in direction of the top of this yr, as vitality prices go up over the winter.
Tory chief Kemi Badenoch warned at PMQs yesterday that the nationwide insurance coverage hike within the Funds would drive up prices for city halls in areas equivalent to care companies.
The occasion claimed there’s a £2.4billion black gap within the funds for native authorities that will should be full of larger taxes.
The occasion has calculated that will quantity to a 6.6 per cent rise throughout the board, roughly £143 further on a Band D property. Council insiders
Darwin Buddy, of the TaxPayers’ Alliance, urged ministers to curb council waste quite than signing off one other spherical of invoice hikes.
‘Taxpayers can be bracing for one more penny-pinching yr forward,’ he mentioned.
‘Councils throughout the UK have both elevated council tax or threatened to extend it. Whereas the cap has not been scrapped, the rise of 5 per cent will nonetheless hit hard-pressed households.
‘The Authorities must crack down on councils to make sure that they’re holding prices to a minimal and delivering front-line companies at the absolute best worth for residents.’
In opposition, Labour complained bitterly in regards to the influence of rising council tax payments on the price of residing.
Eventually yr’s native elections, Ms Reeves mentioned she would use £2.7 billion from a brand new windfall tax on the oil and fuel trade to freeze council tax payments.
On the time, she mentioned: ‘Whereas the Tories assume the cost-of-living disaster is throughout, Labour is on the facet of working folks.’
Tory chief Kemi Badenoch demanded to know whether or not the 5 per cent ceiling can be maintained
The pledge was not repeated in Labour’s manifesto this yr, and a authorities supply mentioned Labour had been ‘very clear’ that it solely utilized within the circumstances in 2023 when it was not in energy.
However Deputy Prime Minister Angela Rayner hinted at a freeze once more as lately as September.
Requested whether or not she would ‘take this chance to reassure the Home that the Authorities has no plans to extend council tax as they assured us earlier than the election’, Ms Rayner replied: ‘Sure.’
Tory MP Kevin Hollinrake mentioned: ‘It is solely after coming underneath strain from Kemi Badenoch that Keir Starmer revealed Labour have damaged their promise to not elevate council tax.
‘Labour made a political resolution to present their union paymasters an inflation-busting pay rise and now it is renters and householders who’re paying the worth.’
