Council tax increases ‘set to hurt the poorest families’

More than two million of the poorest families in the UK face large increases in their council tax bills from next week, warns the Joseph Rowntree Foundation (JRF).

Research from the charity found 2.4 million low-income families will pay an average of £138 extra in council tax once the new financial year comes into effect in April.

These findings are the first full assessment of the Council Tax Benefit (CTB) reform, which is being replaced from April 1st by Council Tax Support (CTS).

The 326 councils throughout England have been forced to devise their own local CTS scheme, however they will receive ten per cent less funding than they did under the previous initiative.

While pensioners are protected against the hike, others are set to be hit hard.

Some 58 councils have decided to retain current levels of support for families, however 232 will now demand council tax from everyone regardless of their income. Families in work will pay £132 more on average, while those not in work will also be forced to pay more.

This will result in 150,000 families paying an average of £300 more a year. Some 1.9 million claimants who are not currently paying any council tax at all will now be required to find on average £140 per year.

JRF said two-thirds of families currently receiving CTB are already in poverty, therefore these changes could potentially worsen their situation further. The research found 300,000 people who are living just above the breadline are now at risk of falling into hardship.

Head of poverty at JRF Chris Goulden said: “Making up the shortfall will be beyond most, with working hours under pressure and benefits falling behind inflation. This tax hike will push people into poverty or cause more hardship for already very poor households, taking money from families who had little to start with.”

For people already finding it hard to make ends meet, this increase in council tax could be extremely painful, as those already lumbered with money troubles could end up building up more credit card debt to pay for basic living expenses.

By James Francis