Martin Lewis speaks on council tax updates
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Council tax increases coupled with a National Insurance hike, £693 rise in energy bills, record fuel prices and real-term benefit and pension cuts are all hitting Britain, resulting in a worsening cost of living crisis. In some areas, Council Tax is expected to rise as much as 4.4 percent, and more than half of British households will experience a £50-or-higher hike.
The average Band D Council Tax bill in England is already £1,898 a year — up from £1,439 in 2010/11.
Of 151 councils that run social care, research by The Mirror showed 89 were planning rises of 2.99 percent – the maximum permitted.
Another 39 planned to use other allowances to authorise higher increases.
Shaun Davies of the Local Government Association warned councils faced a “tough choice” of hiking bills or cutting services.
Last month, Chancellor of the Exchequer Rishi Sunak announced a £150 household rebate through a direct debit to support around 20 million households in Bands A-D with rising bills.
A Department for Levelling-Up, Housing and Communities spokesperson said: “We’ve given the average working family an extra £1,000 in their pockets this year by boosting Universal Credit and we are giving rebates on council tax and energy bills to help with the cost of living.”
Yet the think-tank Resolution Foundation reported a typical family could see their disposable income decrease by four percent – equivalent to £1,000 – in the next year to April 2023.
The poorest households will be hit hardest by the increased cost of living due to expenditure on food and energy rising most.
In a bid to fight soaring inflation and calm the rise in prices, the Bank of England announced this week it would raise interest rates from 0.5 percent to 0.75 percent, returning to their highest levels since March 2020 when Covid restrictions began.
This comes amid concerns the war in Ukraine will force further price increases and worsen the cost of living in Britain.
The Monetary Policy Committee said Russia’s invasion of Ukraine would “accentuate both the peak in inflation and the adverse impact on activity by intensifying the squeeze on household incomes”.
The Office of National Statistics has said increasing energy and fuel prices have contributed to the cost of living crisis.
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Fuel prices have reached record highs amid the Ukraine crisis with the latest figures from Experian Catalist showing prices at 165.89p per litre for petrol and 177.34p per litre for diesel.
This is up from just 148.0p and 151.6p a month ago, respectively.
The RAC reports the cost to fill an average tank of petrol is around £88, while diesel is over £92.
RAC fuel spokesman Simon Williams said drivers “badly need a break from these relentless daily rises”.
He hopes that as wholesale prices begin to fall retailers will be able to pass such reduction onto consumers.
Mr Williams said motorists will be urging Mr Sunak to cut fuel duty or VAT to alleviate pressure on the cost of living.
Any changes will be delivered on Wednesday when Mr Sunak gives the spring statement – an update on the UK economy and a chance to outline policy changes.
A UK Government spokesperson said work is underway to mitigate high prices.
Last week, they told Reuters: “The £12billion in support that we’ve already announced to help with the cost of living includes a freeze on fuel duty for the 12th year in a row – the longest sustained freeze in British history.”
This means it is increasingly important to take care of your finances and budget what you are spending.
Enter your postcode in our calculator and select your Council Tax Band to see your area’s projected rise from April 1, 2022.
Note that figures only apply to the council system in England, not Wales, Scotland or Northern Ireland, and all figures were sourced from finance reports to Cabinet/Executive and Full Council meetings.
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