The Chancellor of the Exchequer has announced new support for local authorities in England to help them freeze council tax for a further year and assist in keeping bills down.
The Government will set aside an extra £450m to help freeze council tax bills in England.
The support for local authorities means that taxpayers living in an average Band D home in England could save up to £72 on a 5% rise in council tax.
Over the past two years the Government has provided grants of around £2bn to help freeze council tax. A freeze in council tax in 2013-14 would represent a real terms cut of around 2% and a fall of 9% in real terms over the past three years.
The £450m will be made available through a new grant scheme to local authorities who decide to freeze or reduce their council tax next year. If they do, councils, police and fire authorities will stand to receive £225m of funding in both financial years 2013-14 and 2014-15, equivalent to raising their 2012-13 council tax by 1%.
In addition, in 2013-14 the Government will propose to lower the local authority tax referendum threshold to 2%.
This would mean if a local authority seeks to raise its relevant basic amount of council tax by more than 2% local people would have the right to keep council tax bills down through a binding referendum veto.
The Secretary of State for Communities and Local Government will formally set out the detail on this in December.
David Sansome, Managing Director of Sansome & George said: “This news is obviously welcome during a period of challenging economic circumstances.
Whilst, in itself, it is unlikely to stimulate any additional activity in the property market, it does enable those occupying property to more readily budget their outgoings.”
