Council Tax bands

[titbumwillypoo]

Council tax bands were set in 1991 and do not reflect the wealth distribution of the country today it's about time they were updated. It's ridiculous that a band D home in Islington where the average house price is £685000 is £1276.48 a year when a Band D house in Barnsley average price of £166000 is £2126.77.
Government should update the banding values, collect all the money and distribute it based on the actual demographics of the area which would be a fairer funding model. Some areas might be child heavy or pensioner heavy and it would allow councils to fulfil their statutory duties better if they had the funding in place.
Band A £0-£100000
Band B £100001-£200000
Band C £200001-£300000
Band D £300001-£400000
Band E £400001-£500000
Band F £500001-£600000
Band G £600001-£700000
Band H £700001 upwards

Definitely doing council tax by property value is unfair.

It harms people on low incomes from areas where housing has been allowed, by successive government policies, to become too expensive.

NB. Council tax benefit was scrapped some years ago. Now individual councils decide how much to discount for people on the lowest incomes. Some still give a full discount, others don't.

So today there's a situation where a single income low waged or disabled person on benefits renting a crappy 1 bedroom flat somewhere like London or parts of the SE, could be in a higher band than a dual income owner occupier household with a house from an area with lower house prices.

London for example has the highest house prices in the UK - but the lowest wages (also I know from friends in London that public services are in many London councils pretty much non existent).

https://www.timeout.com/london/news/the-five-lowest-paid-areas-in-the-uk-are-all-in-london-022424

And obviously loads of people from London and the SE can't all just move somewhere else. As well as many especially the vulnerable needing to stay near family or work or support, if loads of people moved somewhere else then that adds pressure on housing, jobs, and public services where they move to.

Better would be increased income tax - used to nationally fund essential services (that also ends the postcode lottery of public service access and quality). And maybe a local income tax done by councils, based on income (and assets, not including the home someone lives in) for nice to have but not essential local services.

What about taxing footage. So every person is entitled to so much footage at a basic rate. If you house has more than that footage per person-then you pay more.

Much better for families and might shift some pensioners rattling around in family homes into small flats.

I used to live in a 1 bed flat that would have more footage than the terraced house I live in now.

A quarter of primary school places in my borough are empty and that is after some schools have already been closed.This is typical of many London boroughs. Obviously the birth rate is a factor but the cost of housing is another big one. I think London families already have enough financial pressure piled on to them.

Council tax in Islington does not fund the council in Barnsley (to use the above example)

If there is a problem, it's that there isn't enough differentiation within some local authorities. In Islington, there will be very few properties below band D. In areas where property can be very cheap, eg parts of the Northeast, there are a disproportionate number of band A properties. My larger than average 3 bed semi in Co. Durham is band C.

The result of this is not subsidy from elsewhere. It's that council tax in these areas is often among the highest in the country to make up the shortfall

Also a lot of flats aren’t suitable for people with even mild mobility difficulties, which many pensioners will have.

You would then be taxed more. It is the square footage that counts. If it is one person with a lot of spare footage in a flat then they pay more. It doesn't matter if it is a house or flat. You have completely misunderstood.

pensioners wouldn't have to move into a flat just accommodation with less square feet.

If one or two people are living in a 2000 sq ft accommodation they would have to pay more than a family of four living in 2000 sq ft of accommodation because two people would have 1000 ft each and 4 would only have 500 sq ft each.

So people who use fewer services should have to pay more?

And also that would really encourage more HMOs, which is probably not a great thing,

How am I costing more though? My council tax bill is broken down into things like social care, police, fire service etc. How would me having a bigger footprint, but living alone, somehow warrant a bigger CT bill?

What do you think councils spend most of their money on — it’s social care (57% of an average councils spend). Admittedly not all of that is pensioners but a significant majority is.

Other costs are small.. Waste management is 7%, parks 5%, roads 8% etc.

So one pensioner will use fewer services than 2… so why should the single person have to pay more?

I don’t know if you are mixing me up with someone else. I don’t think council tax should be tied to “usage”. I think it should be reformed to be a wealth tax rather than increasing income taxes which are probably topping out the laffer curve right about now.

Im just pointing out that the average pensioner is receiving a lot more in services from the council than the average young person as social care is the biggest ticket item.

Would you support a system where we did away with council tax and just paid for the services we used, bin collections, pay per park entry or a subscription, everyone pays their own social care bill etc?

I used to live in the US and we had to pay for our own bin collections and I actually quite liked it - we could decide how often they came which was nice but I don’t think it works as well for other services and it’s obviously more efficient for one provider to do the lot!

@Rhayader I think we may both be getting confused! I don’t actually think it should be tied to services, but effectively penalising people for having “excess” space when they’re actually using less (which is what a previous poster suggested) didn’t seem a good proposition

Shifting pensioners "rattling around in family homes" to smaller homes aka downsizing has caused a severe shortage in some areas of 1 and 2 bedroom homes. Single people (including vulnerable disabled people and DV victims) and only-child families are suffering as a result.

There's also a shortage of suitable and accessible homes for older people (and disabled people).

The way to address this is with more social housing - including both smaller and larger homes, and accessible homes for the elderly and disabled. More accessible homes are also needed for those who don't need social housing and can buy.

(But downsizing should never be forced, because there's a need to take info account the psychological and physical health impact of moving - something that's especially hard for older people).

@titbumwillypoo Your post sounds like a Labour leaflet.

Call it a poll tax or any other name but it is the only fair way.

I think the point they were making is that people should be incentivised to use that extra space. Housing is in short supply and people should be encouraged to have appropriate sized accommodation.

My (retired) in-laws live alone and have a 7 bedroom house - it is a bit silly… but stamp duty, a lack of suitable options and general moving costs put them off downsizing. It’s nice having a big house at Christmas but mostly it’s just a burden of upkeep and heating bills.

All of this is rearranging deck chairs really. What we actually need is more homes where there are shortages but the government reduced the building target for London and increased it for the Lake District so we probably shouldn’t all hold our breath on that one…

The fairest way would be a local income tax, include ALL income, not just PAYE. Each person pays what they can afford.

I don't understand why the councils don't revalue properties as soon as building control sign of after extensions. Why wait until the property is sold.
In my road 4 houses (4 beds) are band F, all others were 3 beds so band E. However many of the 3 beds have been extended to 4 or 5 beds and are all still band E, apart from one. Many now have a much higher sq ft than the 4 beds which are still the original size. It makes no sense.

But they don’t. The time I got the best value ever was when I was a single parent in the era of poll tax. I was paying for one person and my child was being educated. The childless couple next door were paying double and getting way less in the way of services than I was. It was grossly unfair.

Each person pays what they can afford.

The vast majority of people live in houses they can afford. I'd be a big fan of moving to a property tax instead of council tax. Much better than any increases on vat, income tax, national insurance etc. It'd be a wealth tax on wealth that nobody can hide or move off shore.

So because dh and I chose to have only one child we would pay more? Why? It just make no sense to make council tax at all linked to house value or size.

But four people would likely have a significantly higher cost to the council than two so why should the two pay more?

Several people are favouring more bands above band H (band I in Wales) so that people in "mansions" or "palaces" pay more. The data also shows there is a need for a band below band A, especially for areas in the North. In several areas, over 60% of properties are band A - this should really be split into two or more bands.

Comparisons are often made of the band D tax in different areas, and these often show northern areas are expensive and London & SE areas are cheap. This is a false comparison. Band D in Sheffield is £2268.65 this year, and in Richmond on Thames it is very similar at £2263.66. However, if you compare a typical property (the median) then in Sheffield it is band A paying £1512.43 and in Richmond it is band E paying £2766.70 (83% more).

If anybody wants the data on the number of properties in each band for every council area in England & Wales then the link is
https://www.gov.uk/government/statistics/council-tax-stock-of-properties-2024

Go to "Table CTSOP 1.0_SUP: number of properties by Council Tax band and administrative area at 15 September 2024" to download the data as an Excel spreadsheet (third tab has the data)

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