NALC supports fairer and more transparent council tax collection reforms

We have backed proposals to improve the consistency and effectiveness of council tax collection and enforcement, while calling for greater transparency around parish and town council precepts and fairer treatment of councils within the collection system.

In our response to the government's consultation on improving enforcement of council tax, we expressed our support for measures designed to create a clearer and more proportionate approach to recovering unpaid council tax. The consultation proposes new statutory steps that councils must follow before progressing to formal enforcement action, including the use of reminder and final notices.

We support the proposal that parish and town councils should issue a minimum of one reminder notice and one final notice before pursuing enforcement. This strikes the right balance between supporting residents experiencing financial difficulties and ensuring councils can collect the income needed to fund vital local services.

Our response also calls for reminder notices to include information that helps residents understand how their council tax contributions are used. We suggest that notices should direct residents to relevant billing authority and parish or town council webpages, highlighting the local services that depend on council tax and precept income.

To improve consistency and clarity for taxpayers, we support the introduction of a mandatory national template for reminder and final notices. We believe a standardised approach would help ensure residents receive clear and consistent information regardless of where they live.

A key issue we have raised is the way parish and town council precepts are presented on council tax bills. We reiterated our longstanding position that billing authorities should be required to show any parish and town council precept increases as actual monetary amounts in pounds and pence, rather than as percentages. We argue that this would improve transparency and help residents better understand the cost and value of local services delivered by parish and town councils.

We also urged the government to review wider council tax collection arrangements and amend legislation so that any surplus held within council tax collection accounts can be returned proportionately to parish and town councils. Councils should benefit fairly from surpluses generated through the collection process, reflecting their contribution to local service delivery.

Our response further supports a preventative and flexible approach to council tax collection, encouraging early engagement and tailored support for residents before enforcement action becomes necessary. We believe this can improve collection rates while reducing financial hardship for taxpayers.

We conclude that the proposed reforms represent a positive step towards a more effective, transparent and consistent council tax system. We are calling on the government to build on these changes by improving the visibility of parish and town council precepts and ensuring councils receive a fair share of any council tax collection surpluses.