Improving efficiency of Council Tax collection
Consultation is open in England until 18th November, concerning ways to facilitate improvements in the collection and enforcement process in business rates and council tax.
The Better Business Compliance trial has been running with Manchester City Council, Salford Council, Greater Manchester Police, HMRC and Cabinet Office. This project aims to reduce illegal working, with a focus on capabilities, processes, enforcement and securing good outcomes. As a result of this project, several suggestions have been put forward by the project team for increasing efficiency in collection.
Following discussions with the Better Business Compliance group, the Government proposes to extend the data-sharing gateway which currently exists between HMRC and local authorities. Where a liability order has been obtained, the council taxpayer will have 14 days to voluntarily share employment information with the council to enable the council to make an attachment to earnings.
If this does not happen, the Government proposes to allow HMRC to share employment information with councils. This would help to avoid further court action, would provide quicker access to reliable information, and would not impose any additional costs on the debtor.
The principle of this data -sharing is already well-established for council taxpayers covered by the Local Council Tax Support scheme, and it would make the powers applying to all council tax debtors consistent. . The paper also asks whether there are other legislative or data barriers to efficient council tax collection that, if addressed, could reduce the burden on council taxpayers; and whether there are any data collection or sharing issues that the Government could usefully clarify or address.
IRRV Response to DCLG Consultation: Improving the Efficiency of Council Tax Collection
The Institute of Revenues, Rating and Valuation (IRRV) is pleased to provide the following response to the consultation paper concerning improving the efficiency of council tax collection.
Question 1: Currently following a liability order, HMRC can share employment data on a council taxpayer in arrears where the taxpayer is receiving a reduction through the Local Council Tax Support Scheme. Do you agree that it would be beneficial to extend that approach so that it covers all council taxpayers?
We fully support the proposal to extend the sharing of HMRC employment data in respect of all council taxpayers who are subject of a liability order. The most efficient way of enabling this would be by means of direct access via a secure portal, with the relevant associated protocols in place.
This access would be beneficial to:
- Local authorities, in their bid to maximise council tax collection in efficient and convenient ways;
- The general council tax paying public, as it would achieve consistency of approach with those in receipt of support via the Council Tax Reduction Scheme; and
- The specific council taxpayer who faces enforcement action, as this offers a less expensive method of enforcement, for example in comparison to pursuit of payment via enforcement agents.
Question 2: Are there other legislative or data barriers to efficient council tax collection that, if addressed, would reduce the burden on council taxpayers? Where possible, please supply evidence of the reduction.
In relation to Attachment of Benefit, local authorities often face recovering small amounts of money from low-income council taxpayers who are in receipt of council tax support. The costs of enforcement in these cases can be significantly more than the original tax being recovered. If a mechanism similar to that used for housing benefit overpayment recovery could be enabled for council tax, such that local authorities could request an attachment to benefits, without obtaining a liability order in order to request an attachment to benefits, then efficiencies for local authorities would be created and the council taxpayer would not face the attendant court costs for liability order and other enforcement methods..
In relation to the Valuation Office Agency, it cannot currently share information with local authorities for council tax purposes, such as the names of occupiers and owners; the VOA is prevented from sharing information other than that relating to the schedule of alterations to the valuation list.
Provisions in the Enterprise Bill will allow regulations for VOA disclosure of data for business rates purposes; but these disclosures would not pertain to information shared for council tax for council tax enforcement purposes.
The Institute recommends that consideration should be given to allowing the VOA to share with local authorities the information that they hold, for council tax purposes.
Question 3: Are there any data collection or sharing issues that the Government could usefully clarify or address?
The processes of checking applications for Council Tax Single Person Discount, checking ongoing eligibility and the removal of fraud and error relating to that discount could be made more efficient by applying real time data provisions to this discount category, to enable household composition to be checked by local authorities.
Please contact the Institute should you wish to discuss any of the points raised in this submission.
Reforming business rates appeals: check, challenge, appeal [England]
DCLG have published a consultation document on business rates appeals reform. This is a significant component of the Government’s review of business rates administration.
Ministers have stated that they are determined to address the problems of volumes and timescales associated with the current approach to appeals resolution. They are keen that, so far as possible, businesses understand their rates assessment and gain early refunds where appropriate; and that local authorities experience reduced levels of financial uncertainty.
The proposed package therefore comprises a series of measures to introduce a structured and transparent process, with incentives to encourage early and meaningful engagement between ratepayers and the VOA – something that many businesses have argued for. It develops the 3-stage check-challenge-appeal process which gained support in earlier consultation. Implementation will take place alongside broader modernisation of the tax administration.
The initial consultation closes at 5.00pm on Monday 4 January. DCLG plan a further consultation thereafter on detailed implementation.
The document can be found at:
Public consultation on a review of the non-domestic rating system [Northern Ireland]
The Department of Finance and Personnel in Northern Ireland has now formally commenced a public consultation on a review of the non-domestic rating system.
The consultation period will last for a period of twelve weeks, during which stakeholders are invited to give input on the future direction of business rates within Northern Ireland. The review also seeks views on alternative forms of business taxation as either replacements or supplements to the current rating system.
The consultation paper can be found at the link below:
The deadline for responses is 25th January 2016.
Setting of the Decapitalisation Rates: Scotland
The next revaluation of non-domestic property in Scotland will take effect from 1st April 2017. Some 20% of rateable values are generally derived using the contractor's basis method of valuation. This consultation paper addresses prescription of the decapitalisation rate to be used when subjects are valued using the contractor’s basis. As regards the decapitalisation rates themselves, this paper examines the methodologies available to reach the rates but does not suggest a preferred option. Ministerial decisions on the decapitalisation rates will take into account responses to the consultation. This consultation will close on 23rd November 2015.
Decapitalisation Rates for the 2017 Revaluation: England
This technical discussion paper seeks views on setting the decapitalisation rates to be adopted when properties are valued using the contractor’s basis of valuation for the 2017 revaluation in England. The issues considered by this paper include whether the Government should prescribe the decapitalisation rates, how many rates should be prescribed and the appropriate methodology for arriving at the rates, but does not propose a preferred option. Decisions will be taken in light of responses to this discussion paper. The consultation will close on 9th November 2015.
Business Rates Review (England)
This document, issued by the Treasury under the Conservative and Liberal Democrat coalition government, sets out the terms of reference for the government’s review and provides further information on the review’s aims and core themes. The government welcomed responses from a wide range of interested stakeholder to the questions and requests for evidence included in this paper by 12 June 2015. The review will report its findings by Budget 2016.
Call for Written Evidence by the Commission on Local Tax Reform (Scotland)
The Call for Written Evidence by the Commission asked for views on the future of local taxation in Scotland.
It will use the information to develop its work and explore new ideas The call for written evidence closed on 22 June 2015. All of the responses will be independently read and analysed and the Commission will publish a report setting out this analysis later in the summer.
The IRRV welcome Business Rates Review by Treasury
THe IRRV has welcome the discussion paper launched by the Treasury on 16th March 2015
Business rates review: terms of reference and discussion paper
Published 16th March 2015
Closing Date: 12th June 2015
This document sets out the terms of reference for the government’s review and provides further information on the review’s aims and core themes. The government welcomes responses from a wide range of interested stakeholder to the questions and requests for evidence included in this paper by 12 June 2015. The review will report its findings by Budget 2016.
Exemptions to the Council Tax premium on Second Homes in Wales
Published 13th March 2015
Closing Date: 13th June 2015
This consultation seeks views on proposals for Welsh Ministers to exempt certain categories of dwelling from the additional Council Tax on Second Homes in Wales.
Exemptions to the Council Tax Premium on Long-Term Empty Homes in Wales
Published 13th March 2015
Closing Date: 13th June 2015
This consultation seeks views on proposals for Welsh Ministers to exempt certain categories of dwelling from the additional Council Tax on Long-Term Empty Homes in Wales.
Land Transaction Tax (LTT) consultation
Closing Date 6th May 2015
LTT replaces Stamp Duty Land Tax in Wales from April 2018.
The devolution of some taxes to Wales from April 2018 provides Welsh Government with the opportunity to reshape those taxes to better meet Welsh circumstances and priorities.
The Minister for Finance and Government Business is encouraging members of the public and organisations across Wales and the UK to get involved as Wales takes greater control of its financial future.
Land Transaction Tax will replace the current UK Stamp Duty Land Tax in Wales in 2018. This will affect many of us across Wales, including:
- home buyers and sellers
- builders, developers or investors in property
- businesses renting premises in the non-residential markets
- those who play important roles in the transaction processes.
The Minister has set out her principles for the Welsh taxes and made it clear that they should be fair to people and businesses, support growth and jobs, which in turn will help tackle poverty and support communities.
The consultation seeks views on how the current system can be improved in order to make it more effective, efficient and better suited to the priorities and needs of Wales.
Welsh government has also produced a leaflet on Welsh Taxes which can be viewed at this link: