Rebecca Evans MS, Minister for Finance and Local Government
Today, I am publishing a consultation seeking views on proposals to update the earning thresholds which can be used by local authorities in recovering council tax in certain circumstances.
I am keen to ensure the Welsh Government is doing everything it can to support households who are struggling to make ends meet, particularly in light of the effects of the pandemic. It is right that we should support these families and individuals, and this change will be a step towards easing the financial burden on low-income households in Wales.
In our Programme for Government 2021-2026, the Welsh Government has committed to seeking ways to reform council tax to ensure a fairer system for all. Our plans include looking again at the legislation which supports the council tax system.
Where working households fall into arrears with their council tax, local authorities may apply for an Attachment of Earnings Order to recover the arrears in instalments from their earnings. The amounts which may be recovered are subject to limits based on earnings thresholds set out in legislation. The consultation outlines proposals to uprate these thresholds to reflect increases in the cost-of-living. These changes would enable council tax payers in arrears who are on low incomes to retain more of their weekly or monthly earnings and spread the cost of their debt.
This is an opportunity to make our council tax system fairer and I am keen to hear everyone’s views. Subject to the outcome of the consultation, I will consider amending the legislation which specifies the earnings thresholds, with a view to any changes coming into effect from 1 April 2022.