People are paying too much tax to Cumberland Council, data suggests

The calculation of council tax is based on property values estimated in 1991, and over the last three decades, property values across England have changed dramatically.

This outdated system has resulted in a disproportionate financial burden on those living in areas where house prices have not increased at the same rate as the national average and punishes those whose house prices have not kept up with the rest of the country, the IFS said.

Department for Levelling Up, Housing and Communities figures show the annual cost of a band D council tax property in the Cumberland Council area is £2,284 in 2024-25.

Meanwhile, the average house price in the area was £166,017 in April, meaning a typical household will pay around 1.4 per cent of their property's value in council tax this year.

But nationally, this falls to just 0.7 per cent, and as a result, people in the Cumberland Council area pay significantly more than their current house value indicates they should.

House prices across the country were 5.6 times as big, rising from £54,000 in April 1995 to £298,000 in April this year.

Meanwhile, band D council tax has seen a 3.6-fold increase, meaning house prices have outstripped council tax by 78 per cent.

But some areas are significantly worse off due to council tax rising disproportionately high with house prices.

Meanwhile, in other places, largely in London, house price rises have outstripped council tax increases by more than four or even five times.

This, the IFS said, makes for an unjust system in which people are paying an unfairly high amount of council tax.

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David Phillips, an associate director at the IFS, said it is ‘increasingly absurd’ that council tax valuations are based on 1991 house prices.

"Since this only valuation of houses, values have increased by massively different amounts around the country, meaning that at least half are now effectively in the 'wrong band'.

"Households in the North and Midlands are often in too high a band – and pay too much – while those in London and its environs too low a band – and pay too little – compared to what they would under a modernised tax.

"In other words, in its current form, council tax works against levelling up,” Mr Phillips said.

News and Star readers were asked what they thought about the amount of tax they pay Cumberland Council.

Paula Rae said she pays ‘way too much’ and that £165 is ‘absolutely ridiculous’ for a single person.

Joshua Wyborn said he pays more than his parents who live in a three-bedroom semi-detached house with off-road parking in Norfolk, while he lives in a terraced house with no garden and street parking.

Colin Browne said: “14 years of Tory government has resulted in a cut of money from central government to local councils, especially in the North, resulting in us, the public, paying more and getting less.”

Labour said it has no plans to reform council tax and is ‘committed to keeping taxes on working people as low as possible’.

It said it would consider the impact on councils and taxpayers before making any tax decisions.

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