UK Promises Moratorium On Council Tax Hikes

by Jason Gorringe, Tax-News.com, London

29 September 2010

Communities and Local Government Secretary, Eric Pickles, and Treasury Minister, David Gauke have confirmed that the UK government will not re-evaluate council tax (local tax) rates in England for the five years the current Parliament is in place.

In addition, it was announced that an independent Data Protection Audit of the Valuation Office Agency's (VOA) council tax database is to be carried out to make sure people's privacy is protected when the Agency assesses properties and stores data. “This takes forward the Coalition's desire to defend civil liberties, restore the rights of individuals and in keeping with Britain's tradition of freedom and fairness,” the government said.

The government also announced that there are plans for a broader local government resource review that will examine the way councils are funded, to provide greater financial freedoms and decrease dependency on Whitehall funding, which has previously pushed up council tax in many local authorities due to so-called 'gearing' effects.

Making the announcement, Pickles said:

"We are today confirming that there will be no council tax revaluation, which could have pushed up taxes on people's homes. [In addition,] the new government will protect the privacy of law-abiding citizens and halt state inspectors from unnecessary intrusion, we’re calling time on the surveillance state.”

"Hefty council tax bills are a constant financial worry for many people. Today we are setting their minds at ease, and protecting the interests of the less well-off in particular."

David Gauke, Exchequer Secretary to the Treasury, added:

"We want fairness in the tax system. Therefore this government will avoid an unnecessary and expensive revaluation that could lead to increased council tax bills. The government is committed to being open about its work while protecting the privacy of personal data. To provide assurance on this point, the Valuation Office Agency is commissioning an independent Data Protection Audit of the council tax database."

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