Why do tenants have to pay council tax?

[Goodnightseamer]

It's a domestic property tax. But tenants don't own any property, so they're paying tax on something they don't own. They didn't use to have to pay rates, but they have to pay council tax. Why? NB council tax is not a tax for use of services so that argument doesn't wash. It is a tax where liability is created by the existence of a domestic property. Which tenants clearly do not own.

SD I don't pay rates....I pay rent...because I'm a tenant. Look...I know nothing about economics but how is it that Australian rentals manage to be completely affordable and wages are decent?

How does Australia do it?

The Australian minimum wage is $19.49 per hour. I'm not particularly well qualified and have never earned less than 28 ph since coming here.

Kids earn the minimum wage...even as a retail assistant I was on 28 something an hour.

28 dollars is about 14 pounds.

I know some things here are more expensive...but somehow, it's easier by far to manage. Our rent is more or less what we paid 5 years ago in England for a house in a nice area with a garden.

But here, we have enough money to pay the bills and have some savings too.

Yes it's a tax based on the value of someone else's asset. But surely you can choose whether to live in a Band H London property or a Band A northern city property? You have an element of control over what you ultimately pay.

Assuming your "Council Tax is only 25% of revenue" mantra is correct, then maybe we should all be thankful that they don't decide to increase it to make it 30%, 40% or 50%. Someone has to pay and government will impose tax when/where it suits. Perhaps you could try refusing to pay, and see where it gets you.

I worked for an inner London borough that has seen its central funding decrease by about 50% since 2010. Council tax does pay for services that are absolutely essential for many residents. Housing, social work, care for the elderly, care for the vulnerable, education, fire brigades, policing, and yes BINS... councils fund the lot.

Council Tax in London also contributes to the GLA, so basically paying for some very swanky offices and some serious schmoozing.

It all adds up ya know.

“however the greediness of some people owning multiple houses while others have none is sickening.”

There are enough houses to go round in the country and some of them are dirt cheap but they are not all where people would choose to live. You are assuming that people are born with a right to be housed just where they please. In fact they can be but they have to pay to be where they choose. Someone with nothing would be given a dwelling for free by the state paid by taxing others but it might not be exactly where they chose. Those who work and pay tax have a greater chance of choosing where they live and this is perfectly fair as they need to be near where they work and pay taxes for others.

In a free society an individual can choose what they spend their money on and where they live and in an authoritarian on the state does this. It is not ‘sickening’ a person who has paid tax on their salary chooses to invest it in property rather than splurge it on holidays, meals out, pleasure and bling. It is, rather, prudent and sensible, and will keep them from needing the state’s help when they are old.

Where would you end with this philosophy? No one to have two cars? Or pairs of trousers? Or pants?

You need to study Communism under Comrade Stalin and see how joyous state control of property was. You would not be moaning that people were free to spend tax paid money how they chose. You would be complaining that your whole extended family were housed in a filthy, broken down flat in a hideous polluted area dreading a knock on the door by the secret police who would drag you away in the night, torture you and keep you in prison indefinitely without recourse to law.

I understand that people take the benefits of capitalism, truth and freedom, for granted, because many were too young to have lived through the hellhole the Socialists made of the country in the seventies. And in the seventies there were no houses or flats to rent as a rent controlled market made it too unprofitable for anyone except Rackman landlords to make any money.

I would say beware of what you wish for but better advice would be to extend your knowledge and understanding to make more informed choices and have more enlightened opinions.

If they did not pay it, it would be included in their rent so would work out the same. As I get a reduction for single occupancy and people on welfare do not pay, landlords would rip people off, if it was included.

Lily do you really believe that In a free society an individual can choose what they spend their money on and where they live and in an authoritarian on the state does this ??

I couldn't choose where I lived when I was on a low income in the UK.

Certainly not. And thousands of people can't. Some can't access education to the level needed to compete against those that can in a competitive job market either.

It is not ‘sickening’ a person who has paid tax on their salary chooses to invest it in property rather than splurge it on holidays, meals out, pleasure and bling. It is, rather, prudent and sensible, and will keep them from needing the state’s help when they are old.

It is rather sickening though that if you don't own a property you're apparently splurging it all on 'holidays, meals out, pleasure and bling'.
Not rent, gas, electric, water, council tax (which I agree tenants should pay) and work related expenses, but are in a low paid job. I mean of course I enjoy the luxury of warmth in the house after a 12 hour shift and being able to wash in warm water so I stay respectable for work, what a splurge. There's no holidays, meals out or bling here, I am guilty of the pleasure of gas and electric and no bailiffs at the door for non payment of bills. Oh and I pay tax on my salary too.
Wondered when this thread would start having a dig at those on lower incomes for being feckless and lazy. Funny thing is, those who think people like me are like that have absolutely no issues using the services low income jobs provide.

@Doodoobear, I don’t think @Lilyflower1 was talking about tenants, or people like you. They were presumably just pointing out that describing people who have invested in property as “disgusting” is wrong. The people who have the means to invest in property and become landlords could have chosen to spend all of their disposable income on expensive holidays etc. But the PP presumably isn’t standing at airports shouting “disgusting” at people going on holiday.

A fair society is one where people are allowed to spend the money they earn on what they want to spent it on.

What annoys me is when people demand social housing of a specific type, such as a large house in the middle of London. If you need social housing then you should take that which is available and be grateful.

If someone that has to finance their own housing wants a big house in the middle of London they have to be able to earn sufficient to be able to afford it, why should someone with quite a few kids they cannot afford and has never worked be able to demand a house in a specific place because they have friends there. If we could no longer afford this place we would have to move somewhere else, (and no it is not a big house) and make new friends.

As for Australia, at a guess there might be a little more land available there which would go a long way towards making housing more affordable.

Lilyflower1 - well said.

you don't get to say that something isn't sickening. If it induces nausea in some people they are allowed to describe it as sickening. (some people don't find nose picking sickening, for example, some do, those who don't aren't allowed to dictate the feelings of those who do)

people should generally be allowed to spend their money where they like, but the difference between owning multiple cars, and owning multiple houses, is that when demand for cars goes up the car manufacturers make more cars. there is already high demand for houses in the places where people have jobs, and very limited capacity for new housing in those areas - most new builds are a long bus ride from the town centre. if one person owns two houses in those desirable areas, they are forcing up tee prices and forcing less advantaged people into a rental trap. if there were strict limits on people owning more than one property in a desirable area (perhaps special dispensation for those who need a base in two cities more than 2 hours travel time from one another) then property prices wouldn't spiral out of control, more people could afford their own homes and taxes could go down because there would be less tax income going straight into the pockets of landlords treating other human beings' need for housing as an investment opportunity.

this could also force people to buy their holiday homes in areas which desperately need some inward investment, as these would be the easiest places to be allowed to buy a second property.

Spot on UhareFouxisci.

We humans need shelter to survive - It's an anomaly that housing is considered an asset in the UK. Especially when it's illegal to set up a makeshift home in a cave or in the woods!

Op, you should perhaps consider buying a property and then you will have the asset upon which council tax is based and you can stop being so bitter. Incidentally, council property rent is subsidised.

What annoys me is when people demand social housing of a specific type, such as a large house in the middle of London. If you need social housing then you should take that which is available and be grateful.

Well 'taking that which is available' is largely how social housing works. My SHA you bid on a property, you can bid on as many as you like but you will only get offered what you are eligible for and then only if someone else's need isn't greater than yours by a point system. You only get to turn down 3 and you're back to the back of the queue. Demanding will get you precisely nowhere.
And as for being grateful, well I'm certainly grateful that I have managed a full 2.5 years without having to move yet again, change DC school yet again, pay out over a grand in moving fees and bond yet again after an LL has decided to sell, but wants me to stay until the last minute so they get the rent, or refused to do essential repairs that weren't of my making, but then made the house unliveable putting myself and DD in danger, or the one decent LL I had that lost his wife and wanted to move to be with his family and gave me my bond back early so I could put it on another property and even physically helped me move and treated me like a human being rather than a profit margin. LLs like that do exist, but let's not pretend that the tenant is the one in the strongest position here. I moved 8 times in 14 years, none of which were my choice. The last time there was just nowhere that gave me a chance of getting DD to school, myself to work and that I could afford. I was sofa surfing while DD lived with my mother. I got offered a HA place after applying, it was one of several I bid on, the only one I was offered and I took it. I pay the rent by the way, I had to provide a financial statement to prove I could afford it from my income, which is ya know wages. I also needed to provide a lot of the things that are provided in private rented houses like carpets - SH isn't free, it may be cheaper, my rent is cheaper, but then I get less than when I private rented - I was paying to rent things like the fixtures and fittings too - they're not provided in SH, you get them yourself, so of course you'd pay less if you get less. You wouldn't expect to pay the same for a house with white goods, carpets, curtain poles, light fittings etc than one that was a bare shell with none of those things if you were buying.

"Lily do you really believe that In a free society an individual can choose what they spend their money on and where they live and in an authoritarian on the state does this ??"

No Billhaders, I don't think anyone can do anything they like in a free society. When I first started teaching I could not afford to live where I trained so my DH and I moved over a hundred miles north to be able to afford a place where we could work. But, in a free society, as we were, we had the OPPORTUNITY and liberty to work hard and aspire to our own personal goals. We were left alone to pursue happiness.

This would not be the case in an authoritarian state. And what's more, not only would we not be afforded the opportunity to live as we wished but any dissenting views we held would make us enemies of the state to be persecuted and destroyed. And the state in those sorts of tyrrannous societies is always capricious and vicious. You might think you were one of the 'trusties' whose views were pure and acceptable, but if a party official takes a fancy to your house (or daughter) you have no recourse in law to defend yourself from state violence.

Look at Soviet Russia, Mao's China, Iran, Venezuala, Cuba, Zimbabwe and so on. Whether a left wing or a right wing authoritarian society the method of ruthless enforcement always ensures the same result: misery, torture, rape and death.

The OP is completely correct about the nature of council tax. I’m a manager in a local authority and I very often have to explain to complainants requesting a’refund’ of their council tax because their bin was missed that a tax is not a payment for an expected service but a government tax on property and therefore refunds are not possible.
I don’t agree with the OP that the landlord should be liable, rents would only go up.

I think that owners should be completely liable for council tax. It's a nonsense that they pass this on to tenants.

Doesn't make a difference. If the landlords became liable for council tax they'd only pass it on to tenants as in this unregulated market, they can literally charge whatever they want. If you don't like it, vote Labour!

professornangnang Landlords rent their properties for a profit of course they'll pass on this tax to maintain their margins.

There are a lot of homes rented out on my street and I can always tell when someone on the street has moved out - When mattresses, furniture etc are dumped on the street! The LA charge additionally for collecting these large items.

@UhareFouxisci Mon 18-Nov-19 04:30:43
"the greediness of some people owning multiple houses while others have none is sickening."

I scrimped and saved, went without and did a miserable job that allowed me to buy my own little flat. My OH did the same and when we met years later, married and moved into his bigger flat (widower with 2 DS), we kept mine and rented it out. Fast forward to retirement, having both worked for more than 30 years and paid all taxes and contributions, we each received a small monthly pension and a lump sum. We pooled our lump sums and bought another small flat. I'm one of those affected by the state pension age hike for women so don't get SP for a few more years, I rely on my tiny occupational pension and the rent from my flat to live on.

Both DS are working abroad so we rent out the flats until until their contract ends so they will have a place to live when they return to the Uk. We have had the same tenants for years and charge them under market rate as they look after the properties so well. We had it written into their leases that they will be given six months notice.

We think this is more than fair and a good way of providing for our very old age needs (the dreaded care home!) now we have retired. But hey, I suppose you have the right to your own opinion so go ahead, call me a greedy selfish landlord.

RandomChatter you must live in an awful area.

Lilly But, in a free society, as we were, we had the OPPORTUNITY and liberty to work hard and aspire to our own personal goals. We were left alone to pursue happiness.

You say this....

But...do you REALLY think that everyone has the opportunities you had? No.

They don't.

And I suppose you now might say "Ah, but I grew up on a poor council estate...but I worked hard!"

Which still doesn't mean that all the other kids from low income families are less important or that they don't deserve some help or a push.

Not everyone from a lower socio economic background has the same ability to push forward.

Some people find it harder...for a variety of reasons. Issues at home, illness, disability.

Do you think they're less deserving of a stable, affordable home?

The OP is completely correct about the nature of council tax. I’m a manager in a local authority and I very often have to explain to complainants requesting a’refund’ of their council tax because their bin was missed that a tax is not a payment for an expected service but a government tax on property and therefore refunds are not possible.

Have you told the Valuation Tribunal Service that they’ve got it wrong?

I’m sure they’d be thrilled by your insight that it’s a pure property tax, rather than a personal/property hybrid based on the model of discounting....

@CleansUpDragonPoo well in 18th Century America there were some slave owners who treated their slaves well, didn't rape the women or sell off the children, ensured that their slaves were kept warm and well fed, and probably considered themselves good people. But being a more-ethical-than-most practitioner in a morally abhorrent system does not make the system less morally abhorrent. You are only able to make money on your spare property because there is another family out there who could have afforded their own home if prices hadn't been able to spiral out of control, but are renting instead, and now face a retirement of extreme poverty because their pensions will never stretch to cover their rent, as a direct consequence of you being able to make your retirement more comfortable in this way.

You'd probably not be significantly worse off if you had sold the spare property when it wasn't needed, and invested the money in growing industries helping the economy to thrive and getting a good return on investment, and so have a decent lump sum to help your sons onto the property ladder when the time came. And if the ownership of multiple properties was controlled as I outlined above, that lump sum for your sons would buy a lot more house too, so your whole family could benefit without having trodden on those more disadvantaged than you to get there.

A well-balanced economy does not allow people to make more money doing nothing but relying on a massive imbalance of supply and demand to inflate property prices, rather than putting that money to work in investments in real tangible goods and services being traded at a profit.

It is very simplistic to suggest that everyone renting wishes to buy a house but can't.
I am renting, I do not want to buy a house where I currently live.
I rent my house out to someone who currently doesn't want to own a house where my house is.
The housing market has always included renting and for a variety of reasons this can meet peoples needs.
Renting is my current first choice and I am grateful I can do this.

I think that owners should be completely liable for council tax. It's a nonsense that they pass this on to tenants.

Why is it nonsense, any more than it is that tenants have to pay for their own electricity, gas, water, contents insurance, TV licence, broadband etc.?

You could go even further and say that, as the landlord owns the kitchen cupboards and any built-in bedroom furniture, they should also be expected to fill them with food and clothes for you. After all, why should you be expected to buy food to put in somebody else's cupboards - just because you are the one who will be eating it all?

The landlord will pay for the buildings insurance, because that's protecting their asset. The landlord will pay for repairs to the fixtures and fittings of the building, because this is maintaining their asset and also continuing to provide in good working order that for which you are paying the rent as agreed. The landlord will pay for any mortgage on the property, because that's helping them to buy their asset. They won't pay your council tax for you, which pays for all of the local services that you as resident will/may be using, as that has nothing to do with the property as an asset and everything to do with the property as a home.

Would you be happy for the landlord to have a key to your home and pop in whenever they like? Of course, not, because it's your home and not theirs.

Some rental properties may have one or more of these included in the rental cost, but your rent will be higher to take account of this.

If you do want all of your living costs (other than food and clothing) taken care of for you and to just have to pay one single bill in return for it, you're perfectly at liberty to book permanently into a hotel. Just don't expect it to cost the same for a month there as it would cost to rent a house or flat.