Town halls fail to collect £800 MILLION council tax

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Town halls failed to collect more than £800 million in council tax and business rates last year, it was revealed today.

Local authority coffers missed out on £600,755,000 in unpaid council tax and £214,624,000 in non-domestic rates, Government figures showed.

But Local Government Minister John Healey hailed an improvement in collection rates, saying they had improved in 2007-8 for the eighth year running.

As a result, 97.1 per cent of council tax was paid last year, compared with 96.9 per cent in 2006-7, the Department for Communities and Local Government said.

The proportion of non-domestic rates collected in-year rose over the same period from 98.7 per cent to 98.8 per cent.

Mr Healey urged councils to keep chasing arrears and improve collection rates further.

"It is only fair on other council tax payers that everyone pays what they owe," he said.

In 2006-7, the latest year for which figures are available, more than £130 million of unpaid council tax was written off by town halls.