Unpaid taxes and business rates in the region add up to more than £20m

Dominic Lipinski/PA Wire

Dominic Lipinski/PA Wire - Credit: PA

More than £20m in council tax and business rates owed to the region's councils went unpaid and uncollected in the past financial year, new figures have revealed.

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Just released government statistics showed the combined value of unpaid council tax in Norfolk, plus parts of Suffolk and Cambridgeshire for 2015/16 was £15.3m, up on £14.5m the previous year.

At a time when local authorities have been making cuts because government grants have been reduced, that is money which could have helped balance the books – and a further £6.7m in business rates was also unpaid.

It amounts to an uncollected total of almost £22m in the past 12 months and £42.8m over the past two years.

This is the equivalent of paying the salary of about 1,132 teachers for a year – based on the Department of Education's figure that the average salary for a teacher is £37,800.


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The councils could have brought in £627.8m in council tax, but only £612.5m was paid, while of the £420.2m in business rates which was owed, £413.5m was collected.

On council tax, the worst performer in Norfolk was Norwich City Council, with a collection rate of 94.9pc – a drop on the previous year's 95.2pc. Of the estimated £56.5m which could have been collected, £2.9m went uncollected.

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The year before, the council had failed to collect £2.6m of the £54.7m council tax payable within the financial year.

The council managed to collect 98.5pc of business rates, which brought in £79.1m, but left £1.2m uncollected.

Mike Stonard, Norwich City Council's cabinet member for resources, said: 'The city council takes non-payment of council tax and business rates very seriously, working with individuals and businesses when issues with payment arise and, as a last resort, taking legal action.

'While this report correctly shows that we collected almost 95pc of council tax last year, this doesn't reflect that we continue to pursue the outstanding amount and usually end up recovering close to 99pc.

'The same applies for business rate figures. As a city, Norwich has a different economic environment to many of its neighbours, with a broader range of prosperity and deprivation, as well as a higher turnover of people and businesses.

'This is reflected by these latest figures.'

Broadland was the best performing authority at collecting council tax. with just one per cent going uncollected in 2015/16 – an improvement on the 98.8pc the previous year. The council collected £66.1m of a potential £66.8m.

North Norfolk District Council was best for business rate collection. It collected 99.3pc of what it was owed, bringing in £24.7m of a potential £24.9m. Its 98.6pc rate on council tax placed it second.

The government figures also put North Norfolk District Council second in the county for collection of council tax at 98.6pc.

Wyndham Northam, cabinet member for financial services, said: 'We do understand there are sometimes occasions when circumstances can change and paying council tax or business rates can drop down people's priority list. Paying rates and council tax is the right thing to do and is a legal requirement, so the fact North Norfolk District Council, our businesses and our residents are up at the top of the league table is a super achievement.'

The council said its impressive collection rates were due to officers working hard and making it as easy as possible for residents to keep up to date with council tax payments.

The government's mantra has long been that every penny of council tax not collected means a higher tax for those who do pay on time.

Where does council tax go?

While city and district councils collect council tax, they do not get all of the money. The lion's share goes to county councils and police authorities, while, in some areas, town and parish councils also levy a precept.

For instance, in Norwich, the city council receives 15p out of every pound collected. The rest goes towards services provided by Norfolk County Council (72p in every pound) and the Office of the Police and Crime Commissioner for Norfolk (13p of every pound).

The council tax, which was ushered in to replace the hugely unpopular poll tax, is, unlike its controversial predecessor, a tax on domestic property rather than a levy on an individual.

Councils use the money which is generated to pay for services such as schools, rubbish collection, roads and street lighting.

For the financial year 2016/17, Norfolk County Council increased its share of the tax for the first time in five years, with council leaders saying that was needed to head-off cuts to services.

Even with the increase of just under 4pc, of which 2pc is specifically to pay for adult social care, the council still expects to have to make savings of more than £100m over the next three years.

Business rates are charged on most non-domestic properties, such as shops, offices, pubs, factories, warehouses, holiday rental homes and guesthouses.

What do you think? Write, giving full contact details, to Letters Editor, Prospect House, Rouen Road, Norwich NR1 1RE or email EDPletters@archant.co.uk

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