Council tax revaluation could see some bills drop
The average household in three out of ten local authorities could be moved into a different council tax band as part of the Government’s revaluation exercise, according to new research.
But most of those changing bands would see their bills go down, rather than up, the Halifax claims.
The mortgage lender said house prices in England have risen by an average of 186 per cent since the last revaluation in 1991.
It said if the Government increased council tax bands in line with the rise, the value of a property in band D, on which all other bands are based, would increase from its current level of between £68,001 to £88,000 to include properties worth between £195,000 to £250,000.
But because there are more local authorities where house prices have risen below the English average than above it, more people could end up paying less, rather than more, the Halifax said.
The average household in 53 of the 320 English local authorities would move into a lower band, the building society said.
In contrast, the company said the average home in just 40 local authorities would move into a higher band.
Despite the findings, the Halifax acknowledged that ministers have yet to issue guidance on how the revaluation of homes in England will be assessed, although the Government has indicated that data on house price increases at either a national or regional level may be used.
Meanwhile, the Conservatives pointed out that one in three homes were moved up at least one council tax band following the recent revaluation in Wales. The party said if the same effect was experienced in England, the typical household would see their bill increased by £270 a year.
“Conservatives have long warned that Labour’s revaluation exercise is in reality a stealth tax raid. In Wales, where the revaluation has already happened, one in three homes moved up a least one band,” said Shadow Local Government Secretary, Caroline Spelman.
“If the same thing happens in England, seven million homes will find soaring bills hitting the mat in April 2007, with the typical household having to pay a council tax hike of £270 a year, every year.”
The revaluation of domestic properties will affect council tax bills from April 2007.
