Editing Council Tax (section)

==Calculation==
Each dwelling is allocated to one of eight bands coded by letters A to H (A to I in Wales) on the basis of its assumed capital value (as at 1 April 1991 in England and Scotland, 1 April 2003 in Wales). Newly constructed properties are also assigned a nominal 1991 (2003 for Wales) value.

Each local authority sets a tax rate expressed as the annual levy on a Band D property inhabited by two liable adults. This decision automatically sets the amounts levied on all types of households and dwellings. The ''nominal Band D'' property total is calculated by adding together the number of properties in each band and multiplying by the band ratio. So 100 Band D properties will count as 100 ''nominal Band D'' properties, whereas 100 Band C properties will count as 89 ''nominal Band D'' properties. Each collecting authority then adds together the Band D amounts for their area (or subdivisions of their area in the case, for example, of civil parish council precepts) to reach a total Band D Council Tax bill.

To calculate the Council Tax for a particular property, a ratio is then applied. A Band D property will pay the full amount, whereas a Band H property will pay twice that. Note there is no upper limit for band H. This means that in reality, someone who lives in a multimillion-pound mansion will pay three times more than someone in a bedsit, which falls into Band A.

===Revaluation===
The government had planned to revalue all properties in England in 2007, which would have been the first revaluation since 1993, but in September 2005, it was announced that the revaluation in England would be postponed until "after the next election".<ref>{{cite news |url=http://news.bbc.co.uk/1/hi/uk_politics/4262590.stm |title=Council tax revaluing is shelved |date=20 September 2005 |url-status=live |archive-url=https://web.archive.org/web/20050925011142/http://news.bbc.co.uk/1/hi/uk_politics/4262590.stm |archive-date=25 September 2005 |work=BBC News}}</ref> At the same time, the terms of reference of the Lyons Inquiry were extended and the report date pushed out to December 2006 (subsequently extended to 2007).<ref>{{Cite web|url=http://www.lyonsinquiry.org.uk/index.php?leftbar=news&text=PN061206|title=Lyons Inquiry Press Notice: 6 December 2006|access-date=15 February 2007|archive-date=28 September 2007|archive-url=https://web.archive.org/web/20070928212158/http://www.lyonsinquiry.org.uk/index.php?leftbar=news&text=PN061206|url-status=live}}</ref>

In Wales, tax bills based on the property revaluations use 2003 prices issued in 2005. Because of the surge in house prices over the late 1990s and early 2000s, more than a third of properties in Wales found themselves in a band higher than under the 1991 valuation. Some properties were moved up three or even four bands with consequent large increases in the amount of Council Tax demanded. Some properties were moved into new Band I at the top of the price range. Only 8% of properties were moved down in bands.

However, a large shift of properties between bands will cause a shift in the allocation of the charge between bands, and the tax levied for each particular band will then drop, as the total amount collected will remain the same for each authority (see "calculation of amount" above).

Between the wholesale revaluations, a major change to a property (such as an extension, or some major blight causing loss of value) can trigger a revaluation to a new estimate of the value the property would have reached if sold in 1991. If such a change would result in an increase in value, then re-banding will only take effect when the property is sold or otherwise transferred.

===Current bands===
====England====
In [[England]], the Council Tax bands are as follows:

{| class="wikitable"
|-
! Band !! Value <br /> (relative to 1991 prices) !! Ratio{{efn|name=ratio|The ratio governs the relationship between the bands. For example, a Band B property will pay 78% of the charge set for a Band D property in the same area.}} !! Ratio as % !! Average{{efn|Based on average Band D rate {{as of|2018|lc=y}}}}<ref name="auto">{{Cite web|url=https://www.gov.uk/government/statistics/council-tax-levels-set-by-local-authorities-in-england-2018-to-2019|title=Council Tax levels set by local authorities in England 2018 to 2019 (revised)|website=GOV.UK|date=12 April 2018 |access-date=30 January 2019|archive-date=31 January 2019|archive-url=https://web.archive.org/web/20190131093017/https://www.gov.uk/government/statistics/council-tax-levels-set-by-local-authorities-in-england-2018-to-2019|url-status=live}}</ref>
|-
| A || Up to £40,000            || 6/9 || 67% || £1,114
|-
| B || £40,001 to £52,000       || 7/9 || 78% || £1,300
|-
| C || £52,001 to £68,000       || 8/9 || 89% || £1,486
|-
| D || £68,001 to £88,000       || 9/9 || 100% || £1,671
|-
| E || £88,001 to £120,000      || 11/9 || 122% || £2,043
|-
| F || £120,001 to £160,000     || 13/9 || 144% || £2,414
|-
| G || £160,001 to £320,000     || 15/9 || 167% || £2,786
|-
| H || £320,001 and above       || 18/9 || 200% || £3,343
|}

====Wales====
In [[Wales]], the bands were re-set on 1 April 2005 by the then [[National Assembly for Wales]], based on 2003 valuations.  In addition to revising the band boundaries upwards, an extra band was added.

{| class="wikitable"
|-
! Band !! Value <br /> (relative to 2003 prices) !! Pre-2005 value{{efn|Nominal value as at 1991}} !! Ratio{{efn|name=ratio}} !! Ratio as %
|-
| A || Up to £44,000           || Up to £30,000 || 6/9 || 67%
|-
| B || £44,001 to £65,000      || Up to £39,000 || 7/9 || 78%
|-
| C || £65,001 to £91,000      || Up to £51,000 || 8/9 || 89%
|-
| D || £91,001 to £123,000     || Up to £66,000  || 9/9 || 100%
|-
| E || £123,001 to £162,000    || Up to £90,000  || 11/9 || 122%
|-
| F || £162,001 to £223,000    || Up to £120,000  || 13/9 || 144%
|-
| G || £223,001 to £324,000    || Up to £240,000  || 15/9 || 167%
|-
| H || £324,001 to £424,000    || £240,001 and above || 18/9 || 200%
|-
| I || £424,001 and above      || || 21/9 || 233%
|}

====Scotland====
In [[Scotland]], the current bands are

{| class="wikitable"
|-
! Band !! Value <br /> (relative to 1991 prices) !! Ratio{{efn|name=ratio}} || Ratio as % <br /> from April 2017<ref>{{cite web|url=http://www.gov.scot/Topics/Government/local-government/17999/counciltax|title=Council Tax|last=Scottish Government|date=1 April 2003|website=www.gov.scot|access-date=9 May 2018|url-status=live|archive-url=https://web.archive.org/web/20180118011025/http://www.gov.scot/Topics/Government/local-government/17999/counciltax|archive-date=18 January 2018}}</ref>
|-
| A || Up to £27,000            || 6/9 || 67%
|-
| B || £27,001 to £35,000       || 7/9 || 78%
|-
| C || £35,001 to £45,000       || 8/9 || 89%
|-
| D || £45,001 to £58,000       || 9/9 || 100%
|-
| E || £58,001 to £80,000       || 131/100 || 131%
|-
| F || £80,001 to £106,000      || 163/100 || 163%
|-
| G || £106,001 to £212,000     || 49/25 || 196%
|-
| H || £212,001 and above       || 49/20 || 245%
|}

===Rates===

====Geographic variation====

Due to the different make-up of each council area, Council Tax rates can vary quite a bit between different local authorities. This is less noticeable in parts of the country like Scotland, where band D rates in 2011 varied from a low of £1,024 (in the Western Isles) to a high of £1,230 (in Aberdeen), but the effect can be more pronounced in parts of England. For example, the 2018 rates in London had this sort of distribution:<ref name="auto"/>

{| class="wikitable"
|-
! Council area !! 2018 band D rate !! % of 2018 average
|-
| Westminster || £710.50 || 50%
|-
| Hammersmith & Fulham || £1,022.04 || 72%
|-
| Kensington & Chelsea || £1,139.41 || 80%
|-
| Lambeth || £1,386.27 || 98%
|-
| '''Average''' || '''£1,420.45''' || '''100%'''
|-
| | Islington || £1,429.45 || 101%
|-
| Hounslow || £1,461.99 || 103%
|-
| Enfield || £1,555.40 || 110%
|-
| Croydon || £1,636.96 || 115%
|-
| Kingston-Upon-Thames || £1,771.69 || 125%
|}

====Variation over time====

Under the [[Premiership of Tony Blair|Labour government of Tony Blair]], average Council Tax rates rose dramatically above inflation.<ref>{{cite news|url=http://news.bbc.co.uk/1/hi/uk/6498653.stm|date=27 March 2007 |title=Council tax to increase by 4.2% |work=BBC News|access-date=9 May 2018|url-status=live|archive-url=https://web.archive.org/web/20081225035022/http://news.bbc.co.uk/1/hi/uk/6498653.stm|archive-date=2008-12-25}}</ref><ref>{{cite web|url=http://news.bbc.co.uk/1/hi/uk_politics/7909156.stm|date=25 February 2009 |title=English council tax 'to rise 3%' |website=BBC News |access-date=9 May 2018|url-status=live|archive-url=https://web.archive.org/web/20210410152509/http://news.bbc.co.uk/2/hi/uk_news/politics/7909156.stm|archive-date=2021-04-10}}</ref>

The subsequent Coalition government made an effort to get councils to freeze Council Tax rates, gradually eroding the above inflation increases via ordinary inflation. This was achieved by offering councils large grants in return for freezing their Council Tax rate; for example, in some years these grants were equal to the amount that would have been gained by a 1% Council Tax rise.

In addition, the law has been changed, so that councils cannot increase Council Tax by an amount higher than a cap specified by the government<ref>{{cite news|url=https://www.bbc.co.uk/news/uk-england-35501990|title='Back door' council tax rises exposed|first1=Daniel|last1=Wainwright|first2=Phil|last2=McCann|work=BBC News |date=12 February 2016|access-date=9 May 2018|via=BBC|url-status=live|archive-url=https://web.archive.org/web/20171130112447/http://www.bbc.co.uk/news/uk-england-35501990|archive-date=30 November 2017}}</ref> (currently 3%), without holding a local referendum to approve the change; so far only one council has invoked such a referendum,<ref>{{cite web|url=https://researchbriefings.parliament.uk/ResearchBriefing/Summary/SN05682|title=House of Commons briefing: Council tax: local referendums|access-date=30 January 2019|archive-date=31 January 2019|archive-url=https://web.archive.org/web/20190131040533/https://researchbriefings.parliament.uk/ResearchBriefing/Summary/SN05682|url-status=live}}</ref> but many have raised Council Tax as close to the cap as they can get without passing it (for example, by 2.99%). This limit, combined with falling grants from central government due to [[austerity]] policy, has led councils to have a real-terms cut in spending power of more than 10% in 2021–22 compared to 2009–10,<ref>{{cite web | url=https://www.instituteforgovernment.org.uk/explainer/local-government-funding-england | title=Local government funding in England | date=10 March 2020 |publisher=[[Institute for Government]] }}</ref> which has inevitably led to service reductions and cuts.

Although local government policy is a devolved matter, the [[Barnett Formula]] leads the [[Scottish Government]] to acquire funding somewhat in accordance with central government priorities. Subsequently, by 2013, the Scottish Government froze Council Tax rates for the fourth time.