City’s council tax arrears soar to all-time high

COUNCIL tax arrears in Birmingham have soared to their highest levels on record.

In March, Birmingham City Council was owed £115.6 million in outstanding council tax.

This was a rise from £111 million in 2017/18, and up by almost a fifth from £98.5 million in 2012/13.

This is a cumulative figure and includes arrears that may stretch back to the introduction of council tax in 1993.

Birmingham estimated it could collect £382.6 million last year if everyone paid the council tax they were supposed to.

However, non-payments in 2018/19 totalled £21.4 million, meaning an overall collection rate of 94.4 per cent.

This was down from 94.5 per cent in 2017/18 and is the council’s worst collection rate since 2007/08.

The authority is the largest in the country.

Most councils when they set their budgets do not expect to collect 100 per cent of the council tax for which they bill residents.

But lower than expected collection rates could leave a hole in the council’s budget.

Local authorities across England collected a total of £29.3 billion in council tax relating to 2018/19 bills.

This was an increase of 6.5 per cent compared to 2017/18 - likely due to rising bills and increasing numbers of households, as well as changes in how discounts are applied.

During 2018/19, local authorities collected £625.1 million in council tax arrears and wrote off £195 million of uncollectable council tax.

At March 31, 2019, the total amount of council tax still outstanding amounted to £3.2 billion.

This is an increase from £3 billion in March 2018, although it is down from £3.9 billion in March 2017.