How could council tax change in budget and who would be hardest hit?

"Council tax is one of the biggest outgoings for many households so reports of a shake-up that could add thousands to some annual bills are causing concern. After abandoning a plan to increase income tax in the budget, Rachel Reeves is expected to rely on several smaller tax-raising measures to repair the public finances. Of the ideas still on the table, one is some form of mansion tax that gets the owners of expensive homes in England to pay more."

"A number of scenarios have emerged. One simply doubles council tax on properties in England's top two bands (G and H). Another involves revaluing homes in the three highest tiers (F, G and H) and applying a surcharge to the top 300,000 by value across these bands. Any such measure is likely to be very unpopular with those footing the higher bills,"

"The main sources of income for local authorities are government grants, business rates and council tax, with the latter funding about a quarter of total spending on services. Rates are set locally, but annual rises are capped at 4.99% for councils with responsibility for social care services and 2.99% for those without. It applies to residential properties, and increases in cash terms depend on their council tax band, which are based on 1991 property values graded into eight tiers from A to H."

The chancellor plans to rely on smaller tax-raising measures, including a mansion tax targeting owners of expensive homes in England. Options include doubling council tax for properties in bands G and H, or revaluing homes in bands F, G and H and applying a surcharge to the top 300,000 by value. Such measures would raise annual bills for affected households and are likely to be unpopular, with pressure to scale back from MPs whose constituencies would be hardest hit. Council tax is devolved so figures apply to England only. Council tax funds about a quarter of local services and bands are based on 1991 property values.

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