PAPER C
Purpose
: for Decision
Committee: REPORT TO THE EXECUTIVE
Date : 14 JANUARY 2004
Title : COUNCIL TAX BASE 2004/05
REPORT OF THE PORTFOLIO HOLDER FOR
RESOURCES
IMPLEMENTATION
DATE :26 January 2004
SUMMARY
1.
It is now necessary to set the Council Tax base for
the 2004/05 financial year i.e. the number of equivalent Band D properties on
which the Council Tax and Police Authority precepts are calculated.
CONFIDENTIAL/EXEMPT ITEMS
2.
None
BACKGROUND
3.
The Council must set the Tax Base by no later than 31st
January 2004 and notify the tax base to the Police Authority by that date. The
Council meeting on the 21st January 2004 will therefore need to
consider the recommendations of the Executive.
4. The Local Government Changes for
England (calculation of Council Tax Base)
Regulations
require this Council as a Billing Authority to notify any major precepting
bodies and Parish/Town Councils, on request, by 31st January 2004 of
the Tax Base for the whole or part of the area for the following financial
year.
5. The Tax Base is calculated from
information on the Valuation List as compiled by the Inland Revenue Valuation Offices.
Dwellings fall into eight different valuation bands, A to H, and are assessed
by the Valuation Office. The Tax Base is then calculated in terms of Band D
equivalent properties using the following weightings:
|
BAND |
VALUATION
(£) as at 1/4/91 |
BAND
D (equivalent Weighting) |
A |
Up to
40,000 |
6/9 |
|
B |
40,001
– 52,000 |
7/9 |
|
C |
52,001
– 68,000 |
8/9 |
|
D |
68,001
– 88,000 |
9/9 |
|
E |
88,001
– 120,000 |
11/9 |
|
F |
120,001
– 160,000 |
13/9 |
|
G |
160,001
– 320,000 |
15/9 |
|
H |
More
than 320,000 |
18/9 |
6. The current number of Band D equivalent properties is detailed at Appendix A. The analysis shows the Band D Equivalent Tax Base for the whole and part area of the Island. The figures as presented also allow for current discounts, exemptions and banding reductions arising from disabled applications. The regulations also provide for a distinction to be made between properties subject to a planning condition preventing occupation for a period of at least 28 days, and other second homes.
7. The above discounts include for the current mandatory discount of 50% on second homes and empty properties. The Local Government Act 2003 and associated regulations provide for Local Authorities to set these levels of discount for the 2004/5 financial year.
8. The level of discount on either category of second homes could be set at any rate between 50% and 10%. The minimum level of discount increases the level of Tax Base to 51,499, which would potentially increase revenue by over £1million at current rates of Council Tax (after the necessary bad debt provision). All additional revenue raised through reducing this level of discount can be retained by the Council for its use.
9. The level of discount on empty property could be set to any rate between 50% and zero, at the end of the mandatory period of full Council Tax relief. The impact of any reduced discount would increase the tax base but any increased revenues after the first year would accrue to the Government and not to the Council. This discretion could however be used as a tool to encourage owners of such property to bring them into use as tenanted housing stock.
10. It is then necessary to adjust the Tax Base for anticipated non-collection of Council Tax and for changes in the valuation list which could arise for a variety of reasons such as appeals, new properties and deletions from the list. For 2004/05 and having regard to the current and previous collection rates, I would propose a total allowance of a 1.3% reduction across the whole and parts of the area, in respect of non-collection and any changes in the Valuation List.