AN OVERHAUL of the council tax system in Wales – which could cause bills to soar – should be kept to a minimum, a Gwent council has said.
The Welsh Government has launched a consultation on what it is calling a “fairer council tax system” and has proposed three options of minimal change, modest reform, or expanded reform.
The minimal change option that has been backed by Monmouthshire County Council’s Labour-led cabinet would keep the current nine council tax bands, but involve a revaluation exercise to update the band thresholds to reflect modern property values.
The cabinet has also said it believes no changes should be made until April 2028 at the earliest as the councillor responsible for finance, Ben Callard, said bringing in changes any sooner would be “too much of a shock for households.”
The Welsh Government has asked if changes should be made from April next year or introduced in stages.
The further options of “modest reform” that would have kept the same nine bands and revalued them but allowed changes in the tax rates charged for each band and “expanded reform” that would have increased the number of bands to 12, with additional band at the bottom and two at the top as well as changing tax rates, were opposed by a vote of the full council in December.
The Conservatives have warned the bolder reforms could see council tax rises of 16 per cent for some households in the county. Council tax is based on property values and doesn’t take account of people’s ability to pay.
Cllr Callard, who represents Llanfoist and Govilon, said all three proposals could have a “the potential to negatively impact households in the county.”
He said a simple revaluation would have the “lowest impact”.
Along with the council’s response to the consultation leader Mary Ann Brocklesby will also send a letter, “opposing any changes to council tax which disproportionately impact on Monmouthshire residents”, in line with the motion agreed by the council in December.
Conservative opposition leader, Mitchell Troy and Trellech member, Richard John asked why the council was supporting a revaluation:
“The advice is this will adversely affect Monmouthshire residents and create pockets of poverty, how can you think now is an appropriate time for council tax revaluation?”
Cllr Callard said the council’s response was that if the reform is to progress it should be the model that has the least impact on the county.
Council tax bands in Wales were last revalued in 2003, amid much criticism, but haven’t been updated in England since 1991.
Deputy leader Paul Griffiths, said the council’s December motion only “specifically” asked for the second and third options to be opposed and didn’t require the council to oppose the revaluation.
He said: “It’s irrational to have a property tax that does not reflect current property values. England suffers enormously from not having a revaluation since 1991 and has properties in London taxed still as if they were a working class terrace when they are worth millions, we don’t want that situation in Wales.”
The Chepstow councillor also accused Cllr John of “scaremongering” by stating the cabinet supported a land value tax as he said the Welsh Government has already concluded it doesn’t have the power to introduce one.
Cllr John had also criticised the current system used to allocate Welsh Government funding to councils which he said left Monmouthshire more reliant on its council tax income to pay for services than what he called “better funded councils with hundreds of millions in reserves”.
Cllr Griffiths said the system used to fund Welsh local government was devised by Conservative secretaries of state David Hunt and John Redwood, in the early 1990s, and intended as an “equaliser” so areas of Wales with the lowest property values, and least able to raise funding from council tax, have the highest funding per capita while areas like Monmouthshire are considered to require less funding per head.