Mark Drakeford told to scrap council tax entirely rather than attempting to reform it
Mark Drakeford has been urged not to waste a “once-in-a-generation” opportunity to overhaul the council tax system in Wales.
The Welsh Government put forward plans this week to make the system “fairer” by carrying out a revaluation of the country’s 1.5 million properties to ensure people are paying the right amount.
But charity Citizens Advice Cymru have argued the reforms “do not go far enough”, and that council tax should be scrapped entirely in favour of another type of levy, such as a land value tax.
Countries such as Denmark, Russia and Singapore which have adopted the land value tax charge landowners an amount based on the value of land without regard to buildings, personal property and other improvements
Both Welsh Labour and Plaid Cymru members, who entered into a co-operation agreement last year, have previously backed the idea of introducing such a tax.
“Council tax arrears are the most common debt issue we see at Citizens Advice across Wales,” Luke Young, the charity’s head of policy and campaigns, said.
“Bills are proportionately higher for low income households, and many people become trapped in debt.
“A fairer system of local taxation is the right thing to do.
“We need more than a revaluation of decades-old tax bands, as overdue as that is.
“A complete overhaul of this regressive and distortionary tax is possible, if politicians choose to do it,” he added.
“The Welsh Government must not miss this once-in-a-generation opportunity to transform Wales’ council tax system into a progressive tax based on ability to pay.”
The current proposals could see the creation of different bands with new tax rates chosen for each band.
The last revaluation was done almost 20 years ago in 2003, with the value of homes significantly increasing since then.
Despite this the Welsh Government has claimed an increase in your property’s worth would not necessarily lead to an increase in the amount households would be expected to pay in council tax.
They will also seek a change in the law to stop people being asked to pay their entire annual bill after they miss one monthly payment.
Minister for finance and Local Government, Rebecca Evans, said: “The reforms are not intended to raise more revenue from council taxpayers overall as, while some people could pay more, many others would pay less, and we will consider the need for transitional arrangements for any changes.
“We recognise this is a significant exercise and that we have a great deal of work to do before any changes can be introduced.”
Tory shadow minister Sam Rowlands said: “Ministers must consider the position of those on fixed incomes like pensioners and be mindful of individuals who may not have a significant income in proportion to their house value, especially with the recent movement in house prices.”
Council tax makes up around a fifth of council spending, helping to support local services such as schools, social care, policing, fire and rescue services, and road infrastructure.
Support our Nation today
For the price of a cup of coffee a month you can help us create an independent, not-for-profit, national news service for the people of Wales, by the people of Wales.