Scottish Government plans to increase council tax for larger homes are being opposed by East Lothian councillors amid fears local residents will not benefit from the additional funds.
The national proposal which would see council tax for Band E and above homes rise by between 7.5 to 22.5 per cent annually could see an additional £5million collected in the county.
However a report to councillors from officers warned the local authority’s annual funding from Scottish Government could be reduced to counter balance the new revenue stream.
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The local authority has been asked to put a response into a public consultation on the proposed changes.
And at a virtual meeting of the council on Tuesday the Labour administration urged fellow councillors to back a response ‘strongly opposing’ the plans.
Council leader Norman Hampshire told the meeting that there were 167 council houses which were in Band E, with a handful in higher brackets.
He said the current council tax system was ‘broken and unfair’.
In an amendment to the response he said: “These proposals will also indiscriminately affect pensioners and young families on fixed incomes particularly hard.
“Council’s budgets are under pressure with high interest rates, inflation, increases in energy costs and growth in demand for council services.
“This problem needs to be addressed by an increase in National Government Grant not by these proposed unfair council tax multipliers.
“With the financial pressure that the council is facing it would be
wrong to increase council tax in this way and not be able to use all of the revenue raised for the benefit of East Lothian Council taxpayers.”
Earlier in the meeting councillors approved a public consultation going out later this year on proposed budget cuts to tackle a predicted £27m budget gap next year, including a ‘significant council tax increase’ by the council.
However that increase would go direct to the council and not potentially affect the general funding it receives from Scottish Government.
Officers reporting on the proposed changes by Scottish Government told councillors: “It is important to note that under the current method of distributing funding to local government, this increase would be taken into account and a negative reduction would be applied to the funding received through the general revenue grant.”
However when asked if they could say how much of a reduction it would be they were unable to provide a figure or say if it would be as much as £5m.
Councillor Shona McIntosh told the meeting : “I think we all agree council tax is unfair but given the financial situation we have been presented with to just oppose something which could bring £5m funds in just because an unidentified amount could be taken away makes no sense.”
The SNP group took a short recess after initially asking for the Labour administration’s amendment to be altered to ensure all group leaders were consulted on the response after raising concerns about some of the claims made.
They opted to oppose any response to the public consultation from the council and, along with Councillor McIntosh, opposed the Labour administration’s amendment strongly opposing the proposed changes.
The amendment was passed by 12 votes to seven.
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