Council tax bills increase by 6.4%

The government faced fresh "stealth tax" accusations last night when new figures showed that council taxes across the country will rise by more than three times the rate of inflation.

The government faced fresh "stealth tax" accusations last night when new figures showed that council taxes across the country will rise by more than three times the rate of inflation.

The Tories criticised Labour's tax policies after the Department of Environment, Transport and the Regions confirmed that the average council tax for a Band D home in England in 2001/02 will be £901, a 6.4 per cent rise on last year.

Bills for the next financial year will arrive in letterboxes in the next few days, and ministers are well aware that the increases could cause the Government serious damage at the polls. In London, rises average 8 per cent.

Hilary Armstrong, the Local Government minister, revealed Labour's anxiety over the issue when she blamed local councils for the rises.

But council leaders rejected the criticism, saying that they had been forced to increase bills because of a £12.5bn gap between grants received and the levels of spending expected on services. Floods, staff shortages in the South-east, teachers' pay rises and other unavoidable increases in costs had left them with no option but to put up taxes, they said.

Band D homes, which are valued at between £68,000 and £88,000, are used as the average guide for council taxes across the country.

Archie Norman, the shadow Environment Secretary, said the figures showed that after four years of Labour, typical households were paying £212 more in tax for no improvement in services. "This is the ultimate stealth tax hike - local residents foot the bill, and local councillors take the blame," he said.