Session 2010 - 11
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Localism Bill


Localism Bill
Part 4 — Community empowerment
Chapter 2 — Council tax

40

 

authorities have power to issue precepts to it, is notified by it to

those authorities (“the major precepting authorities concerned”)

within the prescribed period.

(2)   

Where the aggregate calculated (or last calculated) by the authority for

the year under subsection (2) of section 31A above does not exceed that

5

so calculated under subsection (3) of that section, the amount for item

R in subsection (1) above is to be nil.

(3)   

The Secretary of State must make regulations containing rules for

making for any year the calculation required by item T in subsection (1)

above; and a billing authority must make the calculation for any year in

10

accordance with the rules for the time being effective (as regards the

year) under the regulations.

(4)   

Regulations prescribing a period for the purposes of item T in

subsection (1) above may provide that, in any case where a billing

authority fails to notify its calculation to the major precepting

15

authorities concerned within that period, that item must be determined

in the prescribed manner by such authority or authorities as may be

prescribed.

(5)   

The Secretary of State may by regulations do either or both of the

following—

20

(a)   

alter the constituents of any calculation to be made under

subsection (1) above (whether by adding, deleting or amending

items);

(b)   

provide for rules governing the making of any calculation

under that subsection (whether by adding provisions to, or

25

deleting or amending provisions of, this section, or by a

combination of those methods).”

60      

Council tax calculations by major precepting authorities in England

Before section 43 of the Local Government Finance Act 1992 insert—

“42A    

Calculation of council tax requirement by authorities in England

30

(1)   

In relation to each financial year a major precepting authority in

England must make the calculations required by this section.

(2)   

The authority must calculate the aggregate of—

(a)   

the expenditure the authority estimates it will incur in the year

in performing its functions and will charge to a revenue account

35

for the year in accordance with proper practices,

(b)   

such allowance as the authority estimates will be appropriate

for contingencies in relation to amounts to be charged or

credited to a revenue account for a year in accordance with

proper practices,

40

(c)   

the financial reserves which the authority estimates it will be

appropriate to raise in the year for meeting its estimated future

expenditure, and

(d)   

such financial reserves as are sufficient to meet so much of the

amount estimated by the authority to be a revenue account

45

deficit for any earlier financial year as has not already been

provided for.

 
 

Localism Bill
Part 4 — Community empowerment
Chapter 2 — Council tax

41

 

(3)   

The authority must calculate the aggregate of—

(a)   

the income which it estimates will accrue to it in the year and

which it will credit to a revenue account for the year in

accordance with proper practices, other than income which it

estimates will accrue to it in respect of any precept issued by it,

5

and

(b)   

the amount of the financial reserves which the authority

estimates that it will use in order to provide for the items

mentioned in paragraphs (a) and (b) of subsection (2) above.

(4)   

If the aggregate calculated under subsection (2) above exceeds that

10

calculated under subsection (3) above, the authority must calculate the

amount equal to the difference; and the amount so calculated is to be its

council tax requirement for the year.

(5)   

In making the calculation under subsection (2) above the authority

must ignore payments which must be met from a trust fund.

15

(6)   

In estimating under subsection (2)(a) above an authority must take into

account—

(a)   

the amount of any expenditure which it estimates it will incur

in the year in making any repayments of grants or other sums

paid to it by the Secretary of State, and

20

(b)   

in the case of authority which is a county council, the amount of

any levy issued to it for the year.

(7)   

But (except as provided by regulations under section 74 of the 1988 Act)

the authority must not anticipate a levy not issued.

(8)   

For the purposes of subsection (2)(c) above an authority’s estimated

25

future expenditure is—

(a)   

that which the authority estimates it will incur in the financial

year following the year in question, will charge to a revenue

account for the year in accordance with proper practices and

will have to defray in the year before the following sums are

30

sufficiently available—

(i)   

sums which will be payable to it for the year, and

(ii)   

sums in respect of which amounts will be credited to a

revenue account for the year in accordance with proper

practices, and

35

(b)   

that which the authority estimates it will incur in the financial

year referred to in paragraph (a) above or any subsequent

financial year in performing its functions and which will be

charged to a revenue account for that or any other year in

accordance with proper practices.

40

(9)   

In making the calculation under subsection (3) above the authority

must ignore payments which must be made into a trust fund.

(10)   

In estimating under subsection (3)(a) the authority must take into

account the sums which the authority estimates will be paid to it in the

year by billing authorities in accordance with regulations under section

45

99(3) of the 1988 Act.

(11)   

The Secretary of State may by regulations do one or both of the

following—

 
 

Localism Bill
Part 4 — Community empowerment
Chapter 2 — Council tax

42

 

(a)   

alter the constituents of any calculation to be made under

subsection (2) or (3) above (whether by adding, deleting or

amending items);

(b)   

alter the rules governing the making of any calculation under

subsection (2) or (3) above (whether by deleting or amending

5

subsections (5) to (10) above, or any of them, or by adding other

provisions, or by a combination of those methods).

(12)   

This section is subject to section 52ZT below (which requires a direction

to a major precepting authority that the referendum provisions in

Chapter 4ZA are not to apply to the authority for a financial year to

10

state the amount of the authority’s council tax requirement for the

year).

42B     

Calculation of basic amount of tax by authorities in England

(1)   

In relation to each financial year a major precepting authority in

England must calculate the basic amount of its council tax by applying

15

the formula—equation: over[char[R],char[T]]

   

where—

R is the amount calculated (or last calculated) by the authority

under section 42A(4) above as its council tax requirement for

the year;

20

T is the aggregate of the amounts which are calculated by the

billing authorities to which the authority issues precepts (“the

billing authorities concerned”) as their council tax bases for the

year for their areas, or (as the case may require) for the parts of

their areas falling within the authority’s area, and are notified

25

by them to the authority within the prescribed period.

(2)   

Where the aggregate calculated (or last calculated) by the authority for

the year under subsection (2) of section 42A above does not exceed that

so calculated under subsection (3) of that section, the amount for item

R in subsection (1) above is to be nil.

30

(3)   

The Secretary of State must make regulations containing rules for

making for any year the calculation required by item T in subsection (1)

above; and the billing authorities concerned must make the calculations

for any year in accordance with the rules for the time being effective (as

regards the year) under the regulations.

35

(4)   

Regulations prescribing a period for the purposes of item T in

subsection (1) above may provide that, in any case where a billing

authority fails to notify its calculation to the precepting authority

concerned within that period, that item must be determined in the

prescribed manner by such authority or authorities as may be

40

prescribed.

(5)   

The Secretary of State may by regulations do either or both of the

following—

 
 

Localism Bill
Part 4 — Community empowerment
Chapter 2 — Council tax

43

 

(a)   

alter the constituents of any calculation to be made under

subsection (1) above (whether by adding, deleting or amending

items);

(b)   

provide for rules governing the making of any calculation

under that subsection (whether by adding provisions to, or

5

deleting or amending provisions of, this section, or by a

combination of those methods).”

61      

Calculation of council tax requirement by the Greater London Authority

(1)   

Section 85 of the Greater London Authority Act 1999 (calculation of component

and consolidated budget requirements) is amended as follows.

10

(2)   

In the section heading for “budget” substitute “council tax”.

(3)   

In subsection (1) for “43” substitute “42A”.

(4)   

In subsection (4)—

(a)   

in paragraph (a) for the words from “, other than” to “the 1988 Act”

substitute “in accordance with proper practices”, and

15

(b)   

in paragraph (b)—

(i)   

for “expenditure to be charged” substitute “amounts to be

charged or credited”, and

(ii)   

after “for the year” insert “in accordance with proper practices”.

(5)   

In subsection (5) for paragraph (a) substitute—

20

“(a)   

the income which the Authority estimates will accrue to or for

the body in the year and which will be credited to a revenue

account for the year in accordance with proper practices, other

than income which the Authority estimates will accrue in

respect of any precept issued by it;”.

25

(6)   

In subsection (6)( b) for “budget” substitute “council tax”.

(7)   

In subsection (7) for “budget” substitute “council tax”.

(8)   

In subsection (8) for “budget” in both places substitute “council tax”.

(9)   

Omit subsection (9).

(10)   

Section 86 of that Act (provisions supplemental to section 85) is amended as

30

follows.

(11)   

After subsection (1) insert—

“(1A)   

In making any calculation under subsection (4) of section 85 above the

Authority shall ignore payments which must be met from a trust fund.

(1B)   

In estimating under subsection (4)(a) of section 85 above—

35

(a)   

in the case of any functional body, the Authority shall take into

account the amount of any expenditure which it estimates will

be incurred in the year in respect of the body under section 43(1)

of the Local Government Act 2003 or in paying any BID levy for

which the body is liable, and

40

(b)   

in the case of the Mayor, the Authority shall take into account

the amount of any expenditure which it estimates will be

incurred in the year in respect of the Authority under section

 
 

Localism Bill
Part 4 — Community empowerment
Chapter 2 — Council tax

44

 

43(1) of the Local Government Act 2003 or in paying any BID

levy for which the Authority is liable.”

(12)   

After subsection (2A) insert—

“(2B)   

In estimating under subsection (4)(a) of section 85 above in the case of

the Mayor, the Authority shall take into account the amount of any

5

expenditure which the Authority estimates it will incur in the year in

pursuance of regulations under section 99(3) of the Local Government

Finance Act 1988.”

(13)   

After subsection (4) insert—

“(4A)   

In making any calculation under subsection (5) of section 85 above, the

10

Authority must ignore payments which must be made into a trust fund.

(4B)   

In estimating under subsection (5)(a) of section 85 above in the case of

the Mayor, the Authority shall take into account—

(a)   

the amounts which the Authority estimates will be paid to it in

the year by billing authorities in accordance with regulations

15

under section 99(3) of the Local Government Finance Act 1988,

and

(b)   

the amount of any expenditure which it estimates will be

incurred in the year by the Authority in making any

repayments of grants or other sums paid to the Authority by the

20

Secretary of State.

(4C)   

In estimating under subsection (5)(a) of section 85 above in the case of

a functional body, the Authority shall take into account the amount of

any expenditure which it estimates will be incurred in the year in

making by or in respect of the body any repayments of grants or other

25

sums paid to or for the body by the Secretary of State.

(4D)   

In estimating under subsection (5)(a) of section 85 above in the case of

the Mayor’s Office for Policing and Crime, the Authority must use such

amounts as may be prescribed by the Secretary of State as the sums that

are payable to the Mayor’s Office for Policing and Crime in respect of

30

the following items—

(a)   

redistributed non-domestic rates,

(b)   

revenue support grant,

(c)   

general GLA grant, and

(d)   

additional grant.

35

(4E)   

In subsection (4D) above, “prescribed” means specified in, or

determined in accordance with, either—

(a)   

the appropriate report or determination, or

(b)   

regulations made by the Secretary of State,

   

as the Secretary of State may determine in the case of any particular

40

item and any particular financial year or years.

(4F)   

In subsection (4E) above, “the appropriate report or determination”

means—

(a)   

in the case of an item specified in paragraph (a) or (b) of

subsection (4D), the local government finance report for the

45

financial year in question,

 
 

Localism Bill
Part 4 — Community empowerment
Chapter 2 — Council tax

45

 

(b)   

in the case of the item specified in paragraph (c) of that

subsection, the determination under section 100 below for the

financial year in question, and

(c)   

in the case of the item specified in paragraph (d) of that

subsection, the report under section 85 of the Local Government

5

Finance Act 1988 relating to that item.”

(14)   

In subsection (5)(b) for “(4)” substitute “(4F)”.

(15)   

Omit subsection (6).

62      

Calculation of basic amount of tax by the Greater London Authority

(1)   

Section 88 of the Greater London Authority Act 1999 (calculation of basic

10

amount of tax) is amended as follows.

(2)   

In subsection (1) for “44” substitute “42B”.

(3)   

For subsection (2) substitute—

“(2)   

In relation to each financial year the Authority shall calculate the basic

amount of its council tax by applying the formula—equation: over[id[plus[char[R],minus[char[A]]]],char[T]]

15

   

where—

R is the amount calculated (or last calculated) by the Authority

under section 85(8) above as its consolidated council tax

requirement for the year;

A is the amount of the special item;

20

T is the aggregate of the amounts which are calculated by the

billing authorities to which the Authority issues precepts (“the

billing authorities concerned”) as their council tax bases for the

year for their areas and are notified by them to the Authority

within the prescribed period.”

25

(4)   

Omit subsections (3) to (5).

(5)   

In subsection (8) for paragraph (b) substitute—

“(b)   

provide for rules governing the making of any calculation

under that subsection (whether by adding provisions to, or

deleting or amending provisions of, this section, or by a

30

combination of those methods).”

(6)   

Section 89 of that Act (additional calculations: special item for part of Greater

London) is amended as follows.

 
 

Localism Bill
Part 4 — Community empowerment
Chapter 2 — Council tax

46

 

(7)   

For subsection (4) substitute—

“(4)   

For dwellings in any part of Greater London to which the special item

relates, the amount in respect of the special item is given by the

formula—equation: over[times[char[S],num[2.0000000000000000,"2"]],times[char[T],char[P],num[2.0000000000000000,

"2"]]]

   

where—

5

S2 is the amount of the special item;

TP2 is the aggregate of the amounts which are calculated by the

billing authorities to which the Authority has power to issue

precepts as respects the special item (“the billing authorities

concerned”) as their council tax bases for the year for their areas

10

and are notified by them to the Authority within the prescribed

period.”

(8)   

Omit subsections (5) and (6).

(9)   

In subsection (9) for paragraph (b) substitute—

“(b)   

provide for rules governing the making of any calculation

15

under or by virtue of that subsection (whether by adding

provisions to, or deleting or amending provisions of, this

section, or by a combination of those methods).”

63      

Council tax calculation by local precepting authorities in England

Before section 50 of the Local Government Finance Act 1992 insert—

20

“49A    

Calculation of council tax requirement by authorities in England

(1)   

In relation to each financial year a local precepting authority in England

must make the calculations required by this section.

(2)   

The authority must calculate the aggregate of—

(a)   

the expenditure the authority estimates it will incur in the year

25

in performing its functions and will charge to a revenue account

for the year in accordance with proper practices,

(b)   

such allowance as the authority estimates will be appropriate

for contingencies in relation to amounts to be charged or

credited to a revenue account for the year in accordance with

30

proper practices,

(c)   

the financial reserves which the authority estimates it will be

appropriate to raise in the year for meeting its estimated future

expenditure, and

(d)   

such financial reserves as are sufficient to meet so much of the

35

amount estimated by the authority to be a revenue account

deficit for any earlier financial year as has not already been

provided for.

(3)   

The authority must calculate the aggregate of—

(a)   

the income which it estimates will accrue to it in the year and

40

which it will credit to a revenue account for the year in

 
 

 
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Revised 11 March 2011