Council tax increases set to affect 2 million of the poorest households

The Momentum UK Team 31 March 2013

Council Tax increases are set to affect more than two million of the poorest households in England as benefit changes come into force, an anti-poverty think tank has warned.

The Joseph Rowntree foundation have said that the abolition of council tax benefits will result in 150,000 families paying an average increase of £300 a year, whilst an additional 1.9 million claimants will be billed an average of £140 per annum.

The local Government Association has warned of an increase in individuals either unable or unwilling to pay the additional charges, and ministers have called on local councils to protect the most vulnerable from the increases.

Council tax support is to replace the old system of council tax benefits, with responsibility no longer in the hands of central governments. The increase comes as local councils must now decide whether to pass on a recent 10% reduction in the benefit to residents.

It is widely recognised that most have made the decision to increase bills for low income families.

In a report by the new Policy Institute, written for the foundation, findings state that 232 authorities are set to demand council tax from all residents regardless of income, with only 58 retaining their pre existing policies on supporting families.

Chris Goulden, head of poverty at the foundation, said:

"Some of the country's poorest families must find £140 extra from their strained household budgets to pay council tax for the first time. Making up the shortfall will be beyond most, with working hours under pressure and benefits falling behind inflation.

This tax hike will push people into poverty or cause more hardship for already very poor households, taking money from families who had little to start with."

In response to the matter, Housing Minister Mark Prisk said:

"Council tax benefit spending doubled under Labour and welfare reform is a vital part of help to tackle the deficit that we inherited. The localisation of council tax benefit will give councils stronger incentives to cut fraud, promote local enterprise and get people back into work.”