England & Wales Finance

Councils call for greater tax freedom


Photo Credit: StockMonkeys.com via Compfight cc

New research by LGiU and The MJ reveals that four in five councils want the freedom to increase council tax.

The overwhelming majority of local authorities want the freedom to increase council tax, research by the LGiU and the MJ has shown.

In a survey of 130 councils, 80% councils stated that they wanted to have control over setting council tax in 2014, rather than another ‘deal’ from Whitehall.  Rules imposed by the CLG currently mean that councils need to seek a referendum to raise council tax above 2%.

Such findings highlight a clear and strong belief in local decision-making. This has been further underlined by the survey published today by CIPFA which revealed that 41% councils have decided to reject the council tax freeze, including an increasing number of Conservative councils.

But it’s not just the rebels who are calling for greater tax freedom. Even those Conservative councils that have no intention of raising taxes have explained that they would at least like the ability to do so.

Furthermore, some councils called for even greater tax freedoms, with just under half of all respondents stating that they would like additional taxes to be localised. Suggestions were diverse, ranging from recommendations that councils take a share of income tax or a proportion of VAT, collect stamp duty or introduce a hotel tax or a tourist tax.

Councils may not be in accordance as to the precise powers they would like, but the broad set of recommendations should not cloud the overriding message that our research reveals which is that setting taxes locally must prove central to localism.

For further analysis of the results of our finance survey, please see Heather Jameson’s article on The MJ (£).

We will be publishing our own more in detail analysis in the upcoming edition of C’llr Magazine.