Labour's rebanding bungle could cost taxpayers £75 million

12.00.00am BST (GMT +0100) Wed 27th Jul 2005

An enterprising private company is cashing in on fears that Welsh council tax payers could be overcharged by £75million.

Welsh Liberal Democrats have learned that a company called Hometrack stands to make millions from encouraging people to appeal against their rebanding - a task which should be being done by the government, says AM Mike German.

Mr German, Assembly leader of the Welsh Liberal Democrats, has called on Minister Sue Essex to remind people that they can appeal against rebanding free of charge, without relying on intermediaries who will charge whether successful or not.

Mike German, Assembly leader of the Welsh Liberal Democrats said:

"Council Tax is an unfair system and being in the wrong band only adds to the unfairness for thousands of people across Wales. It is clear to everyone that many properties have been incorrectly banded. This knowledge means that people will be very keen to take Hometrack's route to discover whether they are one of those placed in the wrong band and take the chance to appeal.

"If all those who are predicted to be in the wrong band check their valuation and appeal, then Hometrack will receive £2,593,000 from council taxpayers. The company are offering a service that will help people - but it's only because of Labour's botched re-valuation exercise that they can cash-in.

"A private company is filling a gap that should be filled by the Government. Ministers should be telling council tax payers that they can appeal, and that it doesn't cost them anything, not leaving it up to enterprising companies to do the work for them."

Hometrack estimate that up to 65,000 Welsh homes have been incorrectly banded and could end up paying £75million more in Council Tax than they need to between now and the next revaluation in 2013. From its website, the company charges £39.90 for an initial check and assistance in making an appeal.

Mr German added: "People are increasingly aware of how unfair the council tax is, and fail to see the link between spiralling bills and the services they receive. More and more people support a switch to a local income tax (LIT) - a fairer tax based on ability to pay, not the value of the building in which you happen to live. LIT also has the benefit of being easier to collect, and doesn't need painful revaluation every few years."