The confusing world of tax in Penryn
UPDATE January 30, 10am - Since this article was written Cornwall councillors have voted to make everyone of working age, who doesn't live with their parents, pay at least 25 per cent council tax.
This has changed the council tax base yet again.
Penryn town clerk Michelle Davey got in touch to explain: "The new council tax base announced yesterday takes the percentage back to 3.8 per cent or £3.15 [for band D properties], unfortunately to the cost of those claiming benefit."
This equates to £86.15 that Band D equivalent properties in Penryn will pay to the town council from April 1.
ORIGINAL (January 29) - Penryn taxpayers can expect a 7.7 per cent increase in the amount they pay to the town council from April after a rise in the precept was announced.
In November the council agreed to raise its precept (the portion of council tax it receives) by £11,000 to £197,000 for the 2013-14 financial year.
This increase was deemed necessary because of the additional costs involved in running the town’s public toilets, as well as the cost of landscaping Glebe Cemetery.
It equated to an increase of £4.91 per Band D household, or 5.9 per cent.
Since then however, changes to the way council tax is calculated mean that the town council have had to reduce down their precept requirement to £162,000, which takes into account an expected £31,852 tax support grant from Cornwall Council and £2773 from the town’s Harbours Board for the maintenance of the public toilets on Exchequer Quay.
Confusingly, because council tax benefit is being scrapped and replaced by a tax “deduction” or “reduction” scheme, the resulting predicted decrease in the so-called “council tax base” – the amount of households paying council tax – means that this reduced precept will actually result in a greater increased share per Band D-equivalent home.
That is why Band D tax payers will now pay £89.39 to the town council each year, an increase of £6.39 or 7.7 per cent. Town clerk Michelle Davey said the figures were based on “the worse case scenario.”
She said: “People are going to say ‘how come the precept is going down and my council tax is going up’ but it’s effectively the same in the end.
“The discounts being given [instead of council tax benefit] affect the council tax base, which is a calculation of how many Band D-equivalent properties there are in Penryn.
“Because less people are being billed the full amount [of council tax] that has an effect on the council tax base.”
Voting for the precept increase last Monday, town councillors showed concern for Cornwall Council’s plans to fill a £6 million black hole in central government funding by taxing everyone of working age.
Under proposals to be discussed today Cornwall Council wants to make everyone of working age pay at least 25 per cent council tax, regardless of their ability to pay.
Town councillor Martin Mullins said: “I understand what they are trying to do, but if someone is getting benefits because they can’t afford to pay council tax and now they are expecting them to pay 25 per cent, where are they going to get this money from?
“It seems completely stupid to me.”