Latest Public Sector News

09.12.11

Referendum required for council tax increase

Any council planning to increase council tax by 3.5% or more will be required to hold a referendum, Communities Secretary Eric Pickles has announced.

Local people will have to be consulted to endorse the move, as stated in the Localism Act. It is thought that few councils would risk a public vote on tax rises, meaning the rule could act as an unofficial cap on council tax.

Pickles said: “Since 1997 people have seen their council tax more than double, pushing typical bills to £120 a month.

“We are getting to grips with this with another council tax freeze deal and by radically extending direct democracy over big bill increases with a new local tax-lock.

“Councils have a moral obligation to help hardworking families and pensioners with the cost of living.

“If they want to hike taxes on their local residents above 3.5% they'll now need to get a direct democratic mandate to do it.”

The Government is offering a £675m fund to freeze council tax for another year which councils can accept or decline.

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