Households in some parts of England face paying more than £10,000 a year in council tax if Rachel Reeves pursues plans to double rates on more expensive homes.
The Chancellor is said to be plotting a Budget tax raid on ‘wealthy’ households by dramatically hiking the charge for the top council tax bands.
Doubling council tax rates on properties in the highest two bands – band G and H – could raise £4.2billion, according to the Institute for Fiscal Studies (IFS) think tank.
This would help Ms Reeves in her scramble for revenue raisers at her Budget on 26 November, as she looks to plug a multi-billion pound black hole in the public finances.
But critics have warned hiking council tax for more expensive homes would spark a crisis for pensioners on fixed incomes.
It would also whack families who have stretched themselves to afford a dream home, and hammer those in London and the South East where property prices are higher.
More than a million households could see their council tax doubled if the Chancellor targets the top two bands.
A Mail analysis revealed how those living in Rutland would be the hardest hit, with a band H household having their council tax hiked from £5,342 per year to £10,684.
Meanwhile, those in a band G household in the East Midlands county would see their council tax rise from £4,452 per year to £8,903 per year.
The Chancellor is said to be plotting a Budget tax raid on ‘wealthy’ households by dramatically hiking the charge for the top council tax bands
The analysis revealed many other parts of England – including in the South East and South West – where band G and band H households would face council tax bills of more than £8,000 per year.
Tory leader Kemi Badenoch warned that changes to council tax bands would force some pensioners ‘out of their home’.
She said: ‘Creating new higher council tax bands will hammer people who have lived in the same house for decades, particularly pensioners, some of whom will be unable to pay this new tax and be forced out of their home.’
Nigel Farage, leader of Reform UK added: ‘It is an assault on assets and will cause huge consternation amongst older people living in properties they bought many years ago.’
More than a million homes could see their council tax doubled if Rachel Reeves goes ahead with the idea
The move would hammer London and the South East, where property prices are higher
Increasing the charge on existing top council tax bands could raise revenue faster than adding extra bands, another option that has been floated.
Sources have suggested that Ms Reeves has been moving away from more ‘radical’ options, such as replacing council tax with an annual levy based on property values.
Downing Street on Monday did not rule out a council tax hike when asked if the Government was looking at doubling rates for more expensive homes.
Prime Minister Sir Keir Starmer’s official spokesman said: ‘I’m not going to get ahead of the Budget. You wouldn’t expect me to get into tax speculation ahead of it.
‘But the Chancellor has been very clear the Budget will strike the right balance between making sure we have enough money to fund our public services whilst ensuring we can bring growth and investment to businesses.’
