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The Chancellor of the Exchequer George Osborne will announce that the Council Tax freeze will be extended for another year. Any council which budgets for a rise of 2.5% or less will be able to freeze (or cut) the Council Tax. This is because extra grant equivalent to what would have been raised by a 2.5% Council Tax increase will be provided.

So it doesn't stop councils increasing the Council Tax but they would have to increase it by over 2.5% to have any extra revenue – this year none did so.

It is important to stress that the measure does not stop councils cutting the Council Tax either. They would still get that extra money (equivalent to 2.5% of their Council Tax revenue.) East Staffordshire, Ipswich, Windsor and Maidenhead all cut the Council Tax this year – they still got the equivalent extra money others did for a freeze.

The measure will cost £805 million and be funded from existing budgets by identifying underspending in Whitehall.

After the boost to weekly bin collections and right to buy discounts so far most of the good news coinciding with the Party Conference is related to local government.

5 comments for: Council Tax to be frozen for second year

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