The council tax changes that are being proposed in Wales and what it could mean for you

Plans to change how much council tax people in Wales pay is being considered by the Welsh Government.

It's the first time in 20 years that council tax bands in Wales are being revalued. The Welsh Government says the change is needed to make the system fairer and more progressive.

No changes have been made yet, but a consultation has opened for the public to have their say on the proposals.

What is Council Tax?

Council tax is money you pay to your local council, and is based on the value of your home.

It pays for services your local council provides, like bin collections, road maintenance, and running local schools.

Around 20% of council revenue spend is generated from council tax- but it varies between each local authority.

How does the current system work?

The council tax bands we have now were last valued in 2003. The Welsh Government say this makes them 20 years out of date.

But that's not as long ago as England and Scotland- who last revalued their systems in 1991.

The way the system currrently works, the Welsh government say people in lower value homes are paying a higher propertion of council tax than people in higher value homes.

Currently there are nine council tax bands in Wales A-I, that's one more than England and Scotland who both only have eight.

Local councils currently have the power to set Band D.

Around £2.4 billion is raised from 1.5 million homes' council tax in Wales every year.

That's with around half of households in Wales already receiving some sort of reduced bill- like a student exemption, or single adult discount.

What changes are being proposed?

A few different options are being considered for the scale of the reforms, and how quickly they'll come in.

In the Minimal Reform Plan, council tax bands will be re-evaluated to better reflect their market value. This means your house may move into a different band.

In the Modest Reform Plan, council tax bands will be re-evaluated and tax rates would change. Tax rates for the A, B, and C bands would be lowered, Band D would stay the same, and Bands E and above would have higher tax rates.

In the Expanded Reform Plan, council tax bands would be re-evaluated, tax rates would change, and new bands would be added- one below the current Band A, and two above the current highest Band I.

These changes could come in at the earliest by April 2025- at the end of this Senedd Term.

Or changes could be deferred until the next Senedd Term, meaninhg they wouldn't be n place by 2028.

Or the changes could be made in stages, meaning for example minimal or modest reforms came in in 2025, and the expanded reforms could come at a later date.

They're also considering re-valuing council tax bands more often, to keep the system up-to-date.

Will my council tax go up?

Not yet at least.

No decisions have been made and a consultation has been opened where you can have your say.

But, depending on which plan goes ahead, some people's council tax will go up.

This would be the people who own the most expensive homes in Wales- around 30% of households in Wales, or 450,000 homes.

But the Welsh Government say this would be a fairer approach, as people in the lowest value homes would pay an amount more proportionate to their incomes.

Around 70% of people would either pay less, or the same as they do now.

Bills are more likely to go up in areas where property prices are higher than the rest of Wales, and have increased a lot since 2003- like Monmouthshire or the Vale of Glamorgan.

Where properties aren't as expensive, and prices haven't increased so much since 2003, like in Denbighshire or Swansea, bills are more likely to decrease.

But it could be felt on a smaller scale as well- inner city areas of Cardiff and Swansea could see falls in council tax, but suburban areas could see a rise.

How will it affect renters?

Council tax could affect how much people are willing to pay to live in a property, accoring to the Institute for Fiscal Studies.

They say they expect council tax reform to "lead to higher rent for properties whose bills fall, and falls in rent for properties whose bills increase, in effect passing some or all of the gain/loss from tenants to landlords."

When will we know?

The consultation is open until the 6 February 2024. the Welsh Government will look at the results of this and announce the next steps around Easter.

The Finance Minister Rebecca Evans is due to make a statement in the Senedd later today, but was keen to stress that “this is not about raising more money from taxes and changes are not going to happen overnight.

“We are asking people to help us shape the future of council tax in Wales.

"Achieving a fairer council tax will be one of the single most beneficial actions this government can take towards making Wales a more equal nation.

"The benefits will be felt in the pockets of many households.

"We see this very much as being a gradual process and that is why we are also asking for views on the pace of change.”

But Welsh Conservative Shadow Local Government Minister, Sam Rowlands MS says he's concerned the changes would "stealthily hike up council tax for hard working people."

“Since 1999 council tax in Wales has gone up by nearly 200%.

“The last time a revaluation took place in Wales 1 in 3 families were hit with higher bills we can’t allow this to happen in the current cost of living challenge.

“It’s vitally important that any council tax revaluation is fair and justified and doesn’t hit hard working people across Wales.”

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