Millions face council tax sting

COUNCIL tax bills could rocket in four out of five towns in the South under plans to overhaul the system later this year. Millions of families could pay hundreds of pounds more because their homes have been moved up to more expensive council tax bands.

But the majority of households in Labour's heartlands in the North and Midlands will escape the rises.

The impact of the Government's proposed changes would be devastating for hard-working families.

Households in Band D currently pay an average of £1,167 a year. If they were moved up to Band E, their bill would soar to £1,426 - a 22 per cent rise.

The huge increases will be triggered by a revaluation of homes in England to decide which council tax band each should be in. With existing bands based on house prices in 1991, the revaluation this year will take account of spiralling price rises. Bills reflecting it would be issued in 2007.

Ministers have tried to keep their plans under wraps until after the General Election. The average bill has already risen by 70% under Labour since 1997.

But Local Government Minister Nick Raynsford revealed which households will be hit hardest in a little-noticed speech at the end of last year. Homes whose value had risen in line with the national average, a 160% increase since 1991, would not move bands. But he added: 'Only where the change in a property's value is significantly above or below the average is it likely to change bands.'

His formula will trigger huge increases across the South of England, according to research by the Liberal Democrats based on house price statistics from the Halifax.

Their calculations show 81% of towns in the South West, 78% in the South East and around 66% in East Anglia have seen house prices rise above the national average. But in the Labour heartland of the North East, where Tony Blair has his constituency, no towns have seen prices rise faster than the average.

Current average annual payments for council tax reveal the cost of a move into the next band. Band A is £778; B: £907; C: £1,037; D: £1,167; E: £1,426; F: £1,685; G: £1,945; H: £2,334.

In Wales, where a revaluation has already been carried out, the number of households in Cardiff paying Band D or above will soar by nearly 50%. Liberal Democrat spokesman Ed Davey said: 'Labour is set to turn the warm glow of house price rises into a post-election tax timebomb. Revaluation is a typical Labour stealth tax.'

Communities seeking cash for local projects such as a new playground will be allowed to pay a premium on their council tax to fund their plans under proposals outlined by John Prescott yesterday. The Deputy Premier's Neighbourhood Tax plan would allow a vote, which could involve an entire council ward or a handful of streets, with the supplement payable by all if a majority voted in favour of an initiative.

{COUNCIL-TAX-RISE-SOUTH}

Create a FREE account to continue reading

eros

Registration is a free and easy way to support our journalism.

Join our community where you can: comment on stories; sign up to newsletters; enter competitions and access content on our app.

Your email address

Must be at least 6 characters, include an upper and lower case character and a number

You must be at least 18 years old to create an account

* Required fields

Already have an account? SIGN IN

By clicking Create Account you confirm that your data has been entered correctly and you have read and agree to our Terms of use , Cookie policy and Privacy policy .

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged in