{"id":104322,"date":"2025-02-17T11:30:00","date_gmt":"2025-02-17T11:30:00","guid":{"rendered":"https:\/\/en.econostrum.info\/uk\/?p=104322"},"modified":"2025-02-17T10:19:28","modified_gmt":"2025-02-17T10:19:28","slug":"council-tax-crisis-poorest-households","status":"publish","type":"post","link":"https:\/\/en.econostrum.info\/uk\/council-tax-crisis-poorest-households\/","title":{"rendered":"Council Tax Crisis: Poorest Households Now Paying Almost Double"},"content":{"rendered":"\n

The UK\u2019s poorest households are allocating an increasing portion of their income to council tax<\/strong>, according to a new study by the Resolution Foundation<\/strong>. The report reveals that the bottom fifth of earners spent 4.8% of their income<\/strong> on council tax in 2020-21<\/strong>, compared to 2.9% in 2002-03<\/strong>, highlighting a widening financial burden on low-income families.<\/p>\n\n\n\n

At the same time, the richest fifth of households<\/strong> paid just 1.5% of their income<\/strong> in council tax, underlining the disproportionate impact on the poorest citizens. <\/p>\n\n\n\n

The findings have sparked concerns that the tax system is becoming regressive, resembling the controversial poll tax<\/strong> of the 1990s, which was widely criticised for unfairly targeting low-income households.<\/p>\n\n\n\n

Poorest households face higher tax burden<\/strong><\/h2>\n\n\n\n

The Resolution Foundation<\/strong> <\/a>report indicates that council tax is now consuming nearly as much of the poorest households\u2019 income as income tax <\/a>itself<\/strong>.\u00a0<\/p>\n\n\n\n

Lalitha Try, an economist at the think tank, stated that the rising costs have \u201cslowly recreated the issues that undid the poll tax<\/strong>.\u201d She warned that the system is placing increasing pressure on families who are already struggling with living costs<\/strong>.<\/p>\n\n\n\n

Council tax rates vary significantly across England, Wales, Scotland, and Northern Ireland<\/strong>, but the overall trend points to an increasing burden on low-income earners. <\/p>\n\n\n\n

While wealthier households pay a smaller proportion<\/strong> of their income on council tax, lower-income households are hit harder due to outdated property valuations<\/strong> and limited support schemes<\/strong> that fail to offset the rising costs.<\/p>\n\n\n\n

Local authorities granted permission for sharp tax hikes<\/strong><\/h2>\n\n\n\n

Amid financial strain on local councils<\/strong>, the government has authorised six English councils<\/strong> to introduce council tax increases of up to 10%<\/strong> from April 2024<\/strong>. <\/p>\n\n\n\n

According to Angela Rayner<\/strong>, Secretary of State for Housing, Communities and Local Government, the government had \u201cnot taken these decisions lightly<\/strong>\u201d but needed to balance financial stability with taxpayer interests<\/strong>.<\/p>\n\n\n\n

Rayner emphasised that the councils allowed to raise their tax rates were those with historically low council tax levels<\/strong> and that residents <\/a>would still pay less than the national average<\/strong> in some cases.\u00a0<\/p>\n\n\n\n

However, the decision comes as local authorities across the UK struggle with budget deficits<\/strong>, with some councils warning of potential service cuts if funding gaps are not addressed.<\/p>\n\n\n\n

The growing cost of council tax for low-income households<\/strong> has reignited debates over the fairness of the system<\/strong>, with critics arguing for reforms to ensure a more equitable distribution<\/strong> of tax responsibilities. <\/p>\n","protected":false},"excerpt":{"rendered":"

Low-income households in the UK are seeing a growing portion of their earnings consumed by council tax, according to new research. The bottom fifth of earners now pay 4.8% of their income, nearly double the rate from two decades ago. <\/p>\n","protected":false},"author":10,"featured_media":104325,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[29],"tags":[],"class_list":["post-104322","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-taxation","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33","no-featured-image-padding"],"_links":{"self":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/104322","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/comments?post=104322"}],"version-history":[{"count":3,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/104322\/revisions"}],"predecessor-version":[{"id":104331,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/104322\/revisions\/104331"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/media\/104325"}],"wp:attachment":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/media?parent=104322"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/categories?post=104322"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/tags?post=104322"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}