Council tax rises three times higher than RPI inflation
The average council tax bill in Great Britain has increased by 91% over the past decade, according to new Halifax research.The 91% increase is significantly higher than the following over the same period;
a 31% rise in the headline rate of the Retail Price Index;
a 44% increase in the price of services;
a 51% growth in average earnings.
The average council tax per dwelling1 in Britain in the current financial year (2007-08) is £1,078 compared to £564 in 1997-98.
Monmouthshire has recorded the biggest percentage increase since 1997- 98
The biggest percentage increase in the average council tax bill since 1997-98 has been in Monmouthshire (184%) followed by Powys (150%) and Westminster (149%)2. The revaluation in Wales in April 2005 may have contributed to the significant rises recorded in some Welsh areas (see Editors' Notes for details). Despite recording one of the biggest increases over the past decade, Westminster continues to have one of the lowest council tax rates with an average bill of £773 in 2007-08, the seventh lowest in the country.
More than one in two areas have seen at least a doubling in council tax bills in the last ten years
Average area council tax charges have more than doubled since 1997 in 215 billing authorities in Great Britain (53% of the total).
West Dunbartonshire has delivered the smallest rise in average council tax bills since April 1997
The average council tax bill in West Dunbartonshire has risen by 21% from £761 in 1997-98 to £920 in 2007-08. Major cities outside the south of England feature prominently amongst those authorities that have experienced the smallest percentage rises in average council tax charges since 1997. Liverpool, Manchester and Glasgow all feature amongst the five billing authorities with the smallest percentage increases since April 1997.
Richmond-upon-Thames has the highest average council tax bill in the country
The average council tax bill in Richmond-upon-Thames in 2007-08 is £1,665, the highest in Great Britain. This is 106% higher than in 1997-98 (£807). Ten years ago, East Dunbartonshire in Scotland had the highest average bill in Britain (£838).
Four of the ten areas with the highest bills were in the top ten a decade ago
Four of the ten areas with the highest average council tax bills in 2007-08 – Richmond-upon-Thames, Rutland, Chiltern and Elmbridge - were in the comparable list a decade ago.
Wandsworth has the lowest average council tax bill in Britain
The average council tax bill in Wandsworth in 2007-08 is £641, the lowest in the country. This is 65% higher than in 1997-98 (£388). Ten years ago, Westminster had the lowest average bill in Britain (£310).
Four of the ten areas with the lowest bills were in the comparable list in 1997- 98
Four of the ten areas with the lowest average council tax bills in 2007-08 – Wandsworth, Pembrokeshire, Newport and Westminster - were in the comparable list a decade ago.
South Buckinghamshire has seen the biggest monetary increase over the past decade
The average council tax bill has risen by £918 in South Buckinghamshire during the last ten years from £714 in 1997-98 to £1,631 in 2007-08. The next biggest increases have been in Kingston-upon-Thames (£895) and Richmond-upon-Thames (£857). Nine areas have seen an increase in average area council tax charges in excess of £800 since 1997-98.
Two in three areas with the highest bills are in London and the South East
Twenty one of the 30 areas with the highest average council tax bill per dwelling are in London and the South East. Seven are in the East of England and one each is in the South West (East Dorset) and the East Midlands (Rutland). In 1997-98, London and the South East accounted for 17 of the 30 areas with the highest council tax bills. The main difference compared to ten years ago is that there were then eight Scottish billing authorities in the top 30 compared with none in 2007-08.
There is considerable variation in the average council tax bill across Britain
The average council tax bill is highest in Richmond-upon-Thames. At £1,665, it is more than two and a half times higher than in Wandsworth where the average council tax bill is the lowest in the country at £641. In 1997-98, the average council tax bill in the highest billing area - £838 in East Dunbartonshire – was 2.7 times higher than that in the lowest billing area - £310 in Westminster.
Council tax bills are highest in the South East and lowest in Wales
Regionally, the average council tax bill per dwelling is highest in the South East (£1,255) and the East of England (£1,184). Council tax per dwelling is lowest in Wales (£871) and Yorkshire & the Humber (£959).
Wales has more low council tax bills than anywhere else in Britain
Eleven of the 30 areas with the lowest average council tax bill per dwelling are in Wales. Five of the lowest areas are in Scotland and four are in the West Midlands. In 1997-98, 16 of the 30 areas with the lowest average bills were in Wales
Nearly seven in ten areas have an average council tax bill of more than £1,000
281 of the 408 billing authorities surveyed in Great Britain have sent out an average area council tax charge in excess of £1,000 for 2007-08. In 1997, there were no average area charges over £1,000.
The majority of areas in Scotland and Wales have an average bill below £1,000
Almost one in four – 86 out of the 354 billing authorities in England - have sent out an average area charge of under £1,000 for the current tax year (2007-08). This compares with almost two in three billing authorities – 20 out of 32 - in Scotland and nine in ten – 20 of the 22 – billing authorities in Wales.
Caution required when interpreting these figures
The figures in this release should be interpreted with some caution, especially when comparing the average level of council tax charges between authorities. Some councils might argue that the prosperity of their area may influence both the need for spending on services and the available tax pool from which to raise revenue. On the other hand, it is often argued that the block and special grants provided by central government should result in a level playing field between all councils – local government finance has always been a minefield!
Commenting, Martin Ellis, chief economist, said: "Council tax bills have increased significantly faster than either average earnings or retail prices over the past ten years. Bills diverge across the country. Growth rates over the last decade differ by a wide margin between billing authorities too."