The area planning to scrap council tax for low income households

Hundreds of low income households could be given a lifeline as a council in the West Midlands prepares to exempt them from council tax completely.

Stafford Borough Council has proposed the change in a bid to help families struggling with the cost of living crisis.

More than 1,700 households will be eligible for the reduction, and they won’t have to make an application as it will be automatically applied.

Most households in England will see their bills rise by 5% next year, after Jeremy Hunt announced plans to allow English local authorities to increase council tax by 5% annually without a referendum.

However, Stafford Borough Council says it still wants to shield the most vulnerable, as the country faces double-digit inflation and soaring energy bills.

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Already working-aged people on low incomes can receive an 80% reduction under the council’s means-tested system.

Now, it hopes to go one-step further and offer them a 100% discount, meaning they won’t have to pay anything for the financial year of 2023-24, the BBC reports.

If the changes are approved, low income households will join disabled people, parents of children under five, and some pensioners who can already claim a 100% reduction.

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This means that a total of 4,500 households wouldn’t pay any council tax at all, if plans are given the go-ahead at a meeting in February.

Stafford Borough Council cabinet member for resources Mike Smith said: "We know some of our lowest income families are being hardest hit by the significant increases in energy bills and the rise in the cost of living for many everyday essential products and services and we are determined to help those most in need where we can.”

This week, research by consumer campions Which? revealed that an estimated 1.9 million households have missed payments in the run-up to Christmas.

Energy bills, council tax, phone and broadband bills were among the payments that some households reported they had missed.

Nearly six in 10 (56%) people had made at least one financial adjustment – such as cutting back on essentials, selling items or dipping into savings – in the past month to cover essential spending.