Pilot scheme launched to recover unpaid council tax

Birmingham City Council is one of 29 local authorities chosen to pilot a scheme that will help local councils recover unpaid council tax.

As of 31 March 2018, this costs local authorities in England around £3 billion, with the arrears dating back to the introduction of council tax in 1993.

Birmingham City Council is taking part in the trial working with HMRC to be among the first to use the debt information sharing powers introduced by the Digital Economy Act (2017). As part of the trial, non-paying customers who are employed or have an income will be contacted to start paying their arrears, or they will face having their debt deducted directly from their earnings through their employer.

Birmingham City Council issued around 444,000 bills to resident households last year, totalling more than £382 million in council tax – with a collection rate of 94.4 per cent, which meant more than £21 million was unpaid. The national average collection rate is 97 per cent.

Brigid Jones, Deputy Leader of Birmingham City Council, said: “The majority of Birmingham’s citizens pay their council tax, which helps us pay to for vital services and support some of the most vulnerable people in our city.

“We know households face financial struggles and we offer all the support we can, both directly and through the Citizens Advice Birmingham. But, there is a disappointing minority of people who have the means to pay council tax but don’t. It’s not an option, it’s a legal and civic obligation, and these are the people we will be holding to account through this initiative.”