Both Labour and the Conservatives should stop making these claims about council tax

26th Apr 2019 | Abbas Panjwani

As local elections approach, we look at whether you can trust the ever-present claims from both Labour and the Conservatives that they charge less council tax than their rivals. (Spoiler: the answer’s no). 

When we assess claims, there are (broadly speaking) two levels of accuracy we look at. Firstly we ask, is the claim technically accurate, and secondly, are the implications of the claim fair?

In the run-up to local elections, both the Conservative and Labour parties have been claiming that councils they run charge less tax on average than councils controlled by the other party.

This isn’t particularly unexpected; we checked an almost identical pair of claims this time last year as well. It’s understandable that, in the run up to local elections, a political party would want to make that kind of claim.

Unfortunately, given the available data and the methods used to create the averages, both claims end up being pretty meaningless. Neither party uses data that can really be used to compare council tax in different areas.

And even if comparable data was to exist, making these claims implies that the main factor determining council tax rates is the action of the party in control of the council—which isn’t necessarily true.

You can read our original factchecks for a fuller explanation about why both the Conservatives  and Labour are wrong, but here’s a summary.

Conservatives didn’t use proper averages…

The Conservative party used data on the band D council tax charge for each authority. This allows you to easily separate out Conservative and Labour councils. But comparing band D tax rates (while a relatively common practice) is flawed.

This is because band D council tax doesn’t really bear much relation to how much tax households in a council area necessarily pay, for two reasons.

Firstly, band D rates aren’t very close to the average. Within each English council area, council tax will vary depending on the value of your home. Homes are valued on a national scale from band A (the cheapest homes) to band H (the most expensive). As such, band D is nominally the “middle” band, which is why it’s used.

But across England two thirds of homes are in bands A-C, so a band D bill is actually higher than most households will pay, despite being used to talk about “average” tax.

Secondly, using band D rates can make tax in areas with a larger number of more expensive homes look lower than in areas with cheaper homes. Because of the types of councils the two parties tend to control, this may artificially show tax in Conservative areas being lower than in Labour areas.   

Consider the councils of Darlington and Southend-on-Sea. They charge very similar council tax levels overall (averaging £1,200 and £1,204 respectively per dwelling).But Darlington’s band D charge (excluding the money they collect on behalf of other authorities such as the fire service) is £1,506, while Southend’s is £1,382.

So Darlington actually charges an average of £4 less per dwelling than Southend—but its band D rate is £124 more.

That’s partly because 80% of homes in Darlington are below band D, while in Southend it’s 69% —and the formula for setting council tax bills is based on the number of Band D homes in an area.

It’s quite complicated, but in short: while both councils need to collect roughly the same amount of money per household, the band D rate is higher in Darlington because these homes are essentially counterbalancing the lower tax on cheaper homes to a greater extent than in Southend.

… Labour didn’t separate councils properly

The Labour party, on the other hand, used data on the average tax per dwelling, not the band D rates. This has the advantage over band D data of showing the actual amount paid by the average household in any given council area.

But the problem with their data is that, in some cases, it shows money being collected by Labour councils—when in fact most of that tax level is set by Conservative councils.

In England there are two types of local authority. “Billing authorities” collect council taxes, and “precepting authorities” instruct billing authorities to collect council tax on their behalf.

For example, in Burnley, Burnley borough council (a Labour-controlled billing authority) collects council tax, the majority of which goes to Lancashire county council (a Conservative-controlled precepting authority). 

But in the data tables these amounts aren’t split out. So in calculating their average council tax, Labour included the tax charged by 26 Labour district councils, even though most of this is actually set by Conservative county councils.

That means their comparison between “Labour councils” and “Conservative councils” is flawed because you can’t split the two out using this data on average tax per dwelling. 

So how would you do it right?

Ideally, we’d have data showing the average tax paid, per household, to each billing and each precepting authority.

Using this data, you could cleanly separate out Labour and Conservative authorities and make a comparison that avoids the problems associated with using band D data or data that muddies the split between parties that control billing authorities and those that control precepting authorities.

That data could certainly be assembled (although it would take a lot of work). But even if you did that work, this data would still need to be treated with caution. Claiming that councils controlled by one party tax less than those controlled by another party implies that the party in control is the main or only factor at work.

This is clearly not the case. Councils are responsible for a number of services including social care, education, policing and social housing. These responsibilities alone will vary across different authorities. A rural council area that is sparsely populated with people older than average will have very different spending needs to an urban council area that’s densely populated with younger people.

Areas with an older population may collect more tax—not because of the party in charge, but because of the social care needs of the area. The same is true of areas with high social housing needs. It may cost more to do things like collect bins in rural communities that cover a wide area than a smaller urban one. And areas with more businesses may be able to charge lower council tax because they collect more of their income from business rates.

These are just a few examples of how factors other than party control may influence why different councils charge different council tax. If any of those factors align with party control (which many of them often tend to do) then it may be the case that what looks like the impact of a particular party’s leadership on tax is actually due to a completely different factor.

We often encounter topics where there isn’t good enough available data to definitively answer a question one way or the other. Normally we’d say that this shows we need better data to inform public debate.

But in this case, even if we had better data, it wouldn’t guarantee that it would be particularly meaningful.

As we approach 2 May’s  local elections in England and Northern Ireland, you’re likely to hear these claims repeated more and more. Next time you do, it’s worth bearing in mind that they don’t actually tell you anything especially useful. 


We aim for our factchecks to be as accurate and up-to-date as possible. If you think we've made an error or missed some relevant information, please email team@fullfact.org.