Having attended a budget briefing on Monday 11th December, Councillor Craig Browne reported on the latest news regarding Council Tax.
He said "One of the issues that Cheshire East Council has is that in 2014 Council Tax receipts funded about half of the costs of the services that they provided, by 2020 their target is to get that to fund two thirds of the services they provide.
"There are two main reasons for this, the first one is a reduction in the Revenue Support Grant, which is money that local authorities get back from central government, which in the current year has been approximately £30m. Next year it will be only £15.6m and then £10.4m the year after so we are looking at almost exactly a £20m reduction over the next two years from central government."
"The other reason, as many people don't necessarily realise, is that business rates - which are collected by local authorities - the receipts are not exclusively retained by them.
"In Cheshire East's case they only get to keep 30% of the money it collects from business rates. This is calculated by central government and there is formula that takes into account things like deprivation indices, population densities etc which means that whilst Cheshire East only keeps 30% of the business rates it receives Liverpool by contrast receives 130% of the business rates it receives - so this is quite a challenge for Cheshire East going forward."
He continued "So they are looking to increase the amount they raise through Council Tax next year by 7%, that doesn't mean that Council Tax bills are going up by 7%. Council Tax bills are going up by 4.99% but Cheshire East have calculated that they can raise the amount of Council Tax they collect reliant upon them building an additional 1800 homes - because obviously the occupant of those homes are then paying Council Tax and that's Council Tax which is not being paid at the moment."
He added "They are projecting forwards to a 3% increase in Council Tax in 2019/20 and the same again in 2020/21."