Council Tax 4 - Consultation - How it Works...?

Annex A of the document "Localising support for Council Tax inEngland: Consultation" (2 August 2011) describes how council tax (CT) works. It is seemingly accurate as far as it goes but what is not stated is how the valuation side of the CT business works. In short, it is moribund!

Council tax valuations (and the concomitant CT Bands) are stuck in a time warp of the early 1990s. At that time it was not common to see a dwelling worth more than say, £1 million: now they are 10 a penny!  What's more the distribution of values has vastly changed in spread and "enormity".

One imagines that Band A dwellings stand almost cheek by jowl with houses and flats worth £5m, £10m, ... £40m... etc,... etc. Because of time-value changes many will no longer reflect the extant relativities of the current banding system. The result is that "localism" is already unfair in this respect. 

As a result there are two priorities for the government:

1. revalue the 22 million dwellings in England; and,
2. review and reset the relativities of the CT Bands so that Band H is split into 10 or 20 more Bands which will more truly reflect the relative relationships in the pattern of modern capital values rather than those of about 30 years ago!

Incidentally, to be clear and fair, the total amount of council tax collected need not change as a result of the adoption of the above. The proposals merely extend the degree of fairness in the relativities already reflected in Bands A to G. The "hidden" benefits of the current system far outweigh CTBs.

http://www.communities.gov.uk/documents/localgovernment/pdf/19510253.pdf