Council Tax Reduction Scheme

August 5th, 2014 by James Goudie KC

Pursuant to the Local Government Finance Act 2012 Sandwell Council adopted a Council Tax Reduction Scheme.  For working age council taxpayers this was restricted to those who have lived in the Council’s area for over 2 years: the residence requirement.  In R (Winder) v Sandwell MBC (2014) EWHC 2617 (Admin) Hickinbottom J upheld a judicial review challenge to the residence requirement.  The principal ground on which he did so was that it was unlawful as being ultra vires.  The Judge ruled that the residence requirement went beyond the criteria, referenced on financial need, by which, pursuant to the legislation, classes for council tax reduction can be defined. He said, at para 53, that the class must be defined by reference to financial need, albeit by reference to criteria which the authority considers identify those who are, in general, in financial need.  There is considerable discretion in the authority as to the criteria adopted to identify financial need, but, said the Judge, criteria which do not identify those who are at least more likely to be in financial need fall outside the powers granted to an authority by Parliament. 

Alternatively, para 58, the residence requirement was, the Judge held, the use of the statutory power, to relieve those in financial need from the full burden of council tax, for an unauthorized purpose, which the Judge found to be, to discourage people from areas of higher housing cost from moving to Sandwell.


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