Council tax increases to add to ‘harsh squeeze’ on living standards

By William Eichler | 11 March 2022

Households that are already experiencing a squeeze on their finances are to be hit by increases in council tax after April, financial experts have warned.

The Chartered Institute of Public Finance and Accountancy (CIPFA) has calculated that the council tax bill for an average band D equivalent property in England and Wales is to rise by £65 or 3.5%.

CIPFA chief executive officer, Rob Whiteman, said: ‘While households will have to find more money to pay relatively modest council tax increases compared to other bills everyone recognises they will be facing a harsh squeeze on living standards.

'Soaring inflation means this squeeze will be the largest in a generation, with energy bills set to rise by 50%.

‘Councils are facing significant pressures from inflation and the decision to increase bills will not have been taken lightly.

'Funding essential services is vital, but, in the longer run, we hope central Government provides long-term sustainable funding and the devolution of fiscal powers to local authorities.’

The research also found there were what CIPFA local government policy manager Joanne Pitt called ‘increasing discrepancies across the country’ when it came to council tax rises.

Greater London will face the highest rise of 3.7%, although the average bill will still be one of the lowest in the country at £1,682.56.

The bill for an average band D property in the north-east is expected to become the highest in the country at £2,105.95 - a rise of 3.5%.

Ms Pitt said: ‘The latest figures show increasing discrepancies across the country, with band D council tax in the north-east significantly higher than Greater London.

‘If the Government is serious about levelling up and addressing regional inequality tackling this difference should be a part of those plans.’

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