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Councils face a difficult task to replace
Government plans to localise the help that low-income families receive with their council tax while cutting funding for it by 10% leave local councils with a tough challenge to design replacement schemes, according to a new report by IFS researchers.
With 5.9 million recipients, Council Tax Benefit (CTB) is more widely claimed than any other means-tested benefit or tax credit. The UK government is proposing to abolish CTB across Britain from 2013–14 and give local authorities in England, and the Scottish and Welsh governments, grants to create their own systems for rebating council tax to low-income families – though pensioners in England will have to be fully protected. These grants will be based on 90% of what would have been spent on CTB in each area. A new report, funded by the Joseph Rowntree Foundation and published recently by the IFS, examines the likely effects of this policy and the options available to councils.