SW London Facing Council Tax Shock - Lib Dems

12.01.00am GMT Fri 4th Feb 2005

Households in SW London are in line for massive council tax rises because of the threat of revaluation, new Liberal Democrat research has shown.

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.

Families in London and the South East will be worst hit, because house prices have risen so much faster in the region than in the rest of the country.

Analysis of the Halifax house price index by the Liberal Democrats shows that 82% of towns in the region have seen prices rise faster than the national average, meaning homes are likely to be moved into higher paying tax bands. The whole of central London could be moved up a tax bracket.

Carshalton and Wallington MP Tom Brake said,

"Labour is set to turn the warm glow of house price rises into a post election tax timebomb.

"Revaluation is a typical Labour stealth tax. Millions of families will see their Council Tax bills rocket once the election is over, but ministers have refused to come clean about it."

Sutton and Cheam MP Paul Burstow added,

"The government claims Council Tax revaluation will make the system fairer. But this research shows it will be arbitrary, random and unfair.

"Local homeowners are about to be penalised for the market forces that have pushed up house prices in the region. Many will be dealt a financial blow, because council tax rises due to revaluation aren't linked to ability to pay.

"In areas where prices have risen the most, homes could be moved up two, three or even more bands, which could mean tax rises of 50% or more. The danger for the capital is that it could follow Cardiff, where more than 60% of homes were moved into higher bands.

"One home was moved up six bands - more than doubling that family's tax."