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UNIVERSAL CREDIT: Thousands to see tax bill revamp

UNIVERSAL CREDIT: Thousands to see tax bill revamp

New bandings if a revamped council tax reduction scheme is backed in Middlesbrough, Image: Middlesbrough Council

A revamp to make it easier for thousands of Teesside taxpayers to get reductions on their bills is being lined up in Middlesbrough. 

Costs and complications in the existing council tax reduction scheme have seen leaders launch a consultation on changes which would kick in next April.

Working age people eligible for the scheme in the town are means tested at the moment.

But the roll out of Universal Credit for more than 7,500 Middlesbrough folk has meant many claimants have seen their entitlement change several times in the space of a year.

The council says this has placed a bigger burden on its staff – with this worsened by a “massive” rise in the number of benefit claimants due to the pandemic.

Meanwhile, the number of income changes people face on the existing system has left those claiming bill reductions more confused.

Council papers show a new system would offer simpler income bands to work out support for tax bills – rather than means testing income.

And those on the lowest income would receive more support.

A couple with two or more children with a weekly income of less than £260 would receive a 90% discount on their bills – with child benefit and child maintenance disregarded.

Executive Cllr Barrie Cooper said the system was very difficult for people to understand at the moment – and a change would make it easier for staff.

He added: “This report is asking for a consultation only – it’s not asking for a decision on how we do things at this moment in time.

“The purpose of the change is to implement a new working age scheme which will not only provide additional support to working families, but also improve administration.”

A number of people would also see reductions on their council tax bills automatically.

Those claiming Universal Credit would also see their entitlement to council tax reduction processed without the need to claim through another system.

Officials hope this rejig will also boost Middlesbrough’s struggling council tax collection rate – which ranked as one of the worst in the country last year.

Neighbouring Stockton Council is also overhauling its support scheme in response to changes in how Universal Credit is paid out.

Its changes would mean those on the lowest earnings – estimated to be about 8,000 householders in the borough – would pay no charges at all.

The Middlesbrough launch comes as the Universal Credit £20 uplift ended this week.

Figures from the Joseph Rowntree Foundation show there are almost 75,000 households in the Tees Valley in receipt of Universal Credit or working tax credit – with half of these having children.

Almost 20,000 of the households are in Middlesbrough.

 

Words: Alex Metcalfe, Local Democracy Reporter


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