A FINANCIALLY RESTRAINED council insisted that it will ‘very likely’ still have the third lowest rate in Thames Valley despite a huge tax hike.

The government granted Slough Borough Council’s request to increase council tax by nearly 10 per cent this year – an additional five per cent – without holding a local vote from April.

The local authority, which effectively declared bankruptcy in 2021, said this hike is needed to get the borough back on a “sound financial footing” in a world of high inflation in order to protect its services and balance its books.

Among the tax hike, the council is also selling up to £600m of its assets and make about £20m annual savings every year this decade to reduce its £760m borrowing debt.

Even with this increase, the local authority insists the average council tax band D in Slough, which is currently £1,850.09, is ‘very likely’ to remain the third lowest among the seven neighbouring councils, the local authority said.

The increase means the council tax paid on an average band D property will rise to nearly £2,040 in April.

READ MORE: Slough Council set to increase council tax by nearly 10%

With the cost of living crisis mixed in, Slough Borough Council said it is providing additional support for the more than 9,000 households in receipt of the council tax support scheme and for anyone who makes a new application from April.

This scheme will have a maximum council tax reduction of 100 per cent, and it is estimated that some 3,500 (around 38 per cent) of the households with the lowest incomes and currently paying 20 per cent will not need to pay any council tax in 2023/24 should their circumstances remain the same.

Chancellor of Exchequers Jeremy Hunt announced in his Autumn Statement that all local authorities could raise council tax by 4.99 per cent without going to a referendum. Previously, it could only be raised by 2.99 per cent, and raising it above this cap would require a local vote.

Anything above this limit would require a referendum where residents have a say or request government permission to raise tax above the cap without holding a local vote. The Labour-run council decided to do the latter.

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The Conservative-run Thurrock was granted to raise council tax by an additional five per cent, whereas Croydon was given permission to raise the levy by an additional 10 per cent.

The Levelling Up, Housing, and Communities Secretary Michael Gove said the government made an exception for these local authorities because of their ‘unprecedented deficits driven by poor decision making in the past’.

He said: “The government is of course conscious of the impact on local taxpayers, particularly those on low incomes, of having to foot part of the bill for their councils’ very significant failings.

“We have been clear to each of the councils that in implementing any additional increases, they should take steps to mitigate the impact on those least able to pay.”