Cabinet Report |
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Report of Head of Finance Author: Vicky Johnson E-mail: Vicky.johnson@southandvale.gov.uk Wards affected: All |
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Cabinet member responsible: Leigh Rawlins Tel: 01189 722565 E-mail: leigh.rawlins@southoxon.gov.uk
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1. The purpose of this report is to ask Cabinet to recommend the council tax base for 2023/24 to Council for approval.
2. The calculation of the tax base is a legal requirement and an essential part of the tax setting process which helps to achieve the council’s corporate objectives.
3. Before the council tax can be set by the council, a calculation has to be made of the council tax base, which is an estimate of the taxable resources for the district as a whole and for each parish area.
4. The council tax base for the district has to be notified to Oxfordshire County Council and the Police and Crime Commissioner for Thames Valley by 31 January 2023. Each parish and town council is also notified of the figure for its area.
5. The legislation requires that the council tax base is approved by full council or a non-executive body with delegated powers. No such delegation exists, so cabinet is therefore asked to recommend to council the schedule set out in Appendix A as the council tax base for the district as a whole and for each parish area.
6. The starting point for the calculation is the total number of dwellings and their council tax band.
7. The council then allows for the following information, for each band:
(a) dwellings which will be entirely exempt so no tax is payable (e.g. those occupied entirely by students)
(b) dwellings which will attract a 25 per cent reduction (e.g. those with a single adult occupier)
(c) dwellings which will attract a 50 per cent reduction (e.g. those where all of the adult residents qualify for a reduction)
(d) dwellings which will be treated as being in a lower band because they have been adapted for a severely disabled person. The regulations provide methodology to take account of the reduction available to those in band A dwellings
(e) dwellings which will be on the valuation list but which attract discounts or disablement relief or are exempt, for only part of the year
8. Each band is then converted into "band D equivalents" by applying the factor laid down by legislation. For example, a band A dwelling is equal to 2/3 of a band D dwelling and is therefore multiplied by 2/3 to arrive at the band D equivalent figure, whilst a band H dwelling is equal to twice a Band D dwelling and is therefore multiplied by two to arrive at the Band D equivalent figure. All these are then added together to give a total of band D equivalents.
9. A final adjustment is required to allow for non-collection. The council is required to decide what its collection rate is likely to be and apply this to its council tax base. For the 2022/23 tax the council assumed 98 per cent would eventually be collected and it is proposed to use 98 per cent again in 2023/24.
Taxbase for 2023/24
10. Based on the assumptions detailed above the council tax base for 2023/24 is 61,349.5.
11. Similar calculations are required for each parish in order to calculate the proportion of the district's tax base which relates to its area. A schedule of the tax base for each parish is set out in Appendix A.
12. To calculate the council tax amounts payable per property band for the council, its council tax requirement (i.e. the amount of council tax to be raised) is divided by the Band D equivalent (tax base). This will be finalised during January and February, culminating in the council tax being set by council on 16 February 2023 (this date is subject to the council being notified of the major precepting authorities’ council tax requirements).
Climate and ecological impact implications
13. There are no direct climate and ecological implications arising from this report
15. This funding gap is predicted to increase to over £3 million by 2026/27. As there remains no certainty on future local government funding, following the announcement of a one-year spending review by government, and as the long-term financial consequences of the Coronavirus pandemic remain unknown, this gap could increase further. Every financial decision made needs to be cognisant of the need to address this funding gap in future years.
16. The financial implications and calculations for the tax base are set out in the body of the report.
17. These are set out in the body of the report.
18. The council’s methodology for calculating the tax base involves basing the calculation on actual dwellings at a certain point in time, rather than forecasting on potential new dwellings that may be built in the future. Because of this the risk exposure is considered to be low.
Other Implications
19. None
Conclusion
20. As covered above, the calculation of the tax base is a legal requirement and it is asked that Cabinet recommends the council tax base for 2023/24 to Council for approval in accordance with Appendix A.
None
APPENDIX A