Newspaper article The Journal (Newcastle, England)

Osborne's Plans Include Massive Council Tax Hike

Newspaper article The Journal (Newcastle, England)

Osborne's Plans Include Massive Council Tax Hike

Article excerpt

Byline: Jonathan Walker Political Editor

GEORGE Osborne's Budget plans include a massive hike in council tax, it has emerged. The tax rise is revealed in documents published alongside the Budget.

They say council tax will rise by 14 per cent over the next five years.

The increase is partly because Mr Osborne has given councils new powers to add an extra fee to tax bills - known as a precept - to help cashstrapped care services, which have been hit by cuts in grants from Central Government.

And some residents are also being asked to pay more tax to make up for Government cuts in police funding.

The predicted increase is in "real terms", which means it comes on top of the effect of inflation.

In Gateshead, a 14-per-cent increase means an extra PS205.94 would be added to annual bills for a "Band D" property. Because the prediction doesn't include inflation, the total increase will actually be higher.

Homes are divided into bands based on the value of the property, so that people in more expensive homes pay more and those in less valuable homes pay less.

In Newcastle, a 14-per-cent increase would mean an extra PS193.34 is added to Band D council tax bills.

In North Tyneside, the figure is PS185.92, in South Tyneside it is PS184.38, in Sunderland it is PS166.04, in Northumberland it is PS199.92 and in Durham it is PS186.76.

The tax rise is revealed in a report by the Office for Budget Responsibility. This is an independent body set up by the Government and funded by the Treasury which produces reports on the state of the economy and Government policies.

It published a report to accompany the Chancellor's Budget on Wednesday which looked at the effect of the Chancellor's announcements over the next five years.

As well as an extra charge for social care, the report highlighted a new rule allowing police and crime commissioners to increase the police precept, another charge added to council tax bills.

It said: "Local sources of financing are dominated by council tax and business rates.

"We expect council tax to rise by 14 per cent in real terms over the forecast period, in part due to the Autumn Statement announcements help- ing some local authorities to increase council tax more quickly to meet some of the costs associated with adult social care and policing. …

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