Labour to send Council Tax bills rocketing, warn Liberal Democrats

12.33.06pm BST (GMT +0100) Tue 12th Apr 2005

Council Tax payers in Islington face a post-election tax bombshell from the Government, Liberal Democrats warned today.

The Liberal Democrats want to see Council Tax axed and replaced with a fairer local income tax instead.

Council tax is currently based on property values in April 1991 but the government is updating its valuation figures to take account of changes in property prices since then.

Islington will be the worst-hit because house prices have risen faster in the borough than anywhere else in Britain.

House prices in Islington have risen 368% since 1991 compared to the national average of 175%, according to the latest research from the Halifax House Price Index. Anyone whose home has gone up more than the national average since 1991 will be moved into a higher tax band. That means bills will rise by up to 22%.

In Wales, where revaluation has already happened, some families will see their council tax bill TREBLE. That could be repeated across Islington, because of house price inflation.

Liberal Democrat prospective parliamentary candidate for Islington South and Finsbury Bridget Fox said:

"Council Tax is unfair, and revaluation is going to make it worse. Just because house prices have risen in London, local people will have to struggle to find hundreds of pounds extra in Council Tax.

"Both the other parties try and deny it, but they simply have no solutions to the ticking time-bomb of spiralling Council Tax bills. The biggest post-election tax rises will come from the Labour and Tory-backed plans for rebanding.

"The whole Council Tax system is bust, and it is time to scrap it. Liberal Democrat plans to replace it with a fair system based on ability to pay would cut the typical family's bill by around £450 a year."