Anglesey’s Council Tax Premium Budget Forecasting £523k Surplus

Anglesey’s Council Tax premium budget is forecasting a surplus of £523k at the end of the financial year.
The current core Council Tax income is also expected to be £68k above its
budget.
The figures come within a county council report  to be discussed by the authority’s executive on Tuesday (September 23).
From April 1, 2017, local authorities were givn discretionary powers to charge a premium of up to 100% of the standard rate of Council Tax on long-term empty homes and second homes. Since April 1, 2023, the maximum level at which local authorities could set council tax premiums increased to 300%.
Currently, Anglesey charges a premium of 100% in addition to the full Council Tax charge, that is, 200%, with regard to long term empty property and second homes.
The premium aims to encourage owners of empty properties and second homes to return their properties to general use – in a bid to increase stocks of local, affordable housing.
However, the report states there exists “a risk that the number of properties paying the premium can reduce significantly during the year”.
It added: “In order to mitigate this risk the tax base for premium properties is set at 80%.
“If the numbers of properties paying the premium does not fall significantly, then the budget will generate a surplus.”
The change in the eligibility rules for business rates on self catering accommodation had also “resulted in a number of properties being transferred back from business rates to Council Tax”.
This had “increased properties subject to the second home premium” and had “off-set the reduction in properties resulting from the increase in the premium from 75% to 100%,” the report stated.
“As a result, the Council Tax premium budget is forecasting a
surplus of £523k at the end of the financial year.”
It also described how the Council Tax core fund budget was determined “using the estimated collectable debt for the current year only,” based on the tax base figure set in November, 2023.
“It does not provide for arrears collected from previous years, adjustments to liabilities arising from previous years (exemptions, single person discounts, transfers to business rates etc), changes to the current year’s tax-base
or the provision for bad and doubtful debts,” the report said.
These changes cannot be estimated when the budget is being set  and the report notes can “invariably, lead to a difference between the final balance on the Council Tax Collection Fund, and the original budget”.
The report adds: “Historically, the foretasted levels of Council Tax fall during the year as recovery action is undertaken and taxpayers come forward to claim exemptions and discounts that they are entitled to.
“The current core Council Tax income is forecasted to be £68k above the
budget.”

By Dale Spridgeon – Local Democracy Reporter