Wolverhampton council writes off £2.3m unpaid taxes

The cash-strapped authority has incurred 3,702 individual council tax debt write-offs totalling £743,120 and £1,613,153 in uncollected business rates.

It comes despite the council needing to save £134m by 2019, a financial strain that has led to the closure of care homes, dozens of services being cut and the axing of 2,000 jobs.

Bosses today said the debt has been written off as the as there was no way they could recover the cash.

The figures were revealed in a report to the council's cabinet resources panel. Bosses are set to agree to write off additional council tax and business rates debts of £112,490 at a meeting next week.

The council is owed more than £10m in council tax, including £3.6m from the last financial year.

Councillor Andrew Johnson, cabinet member for resources, said: "Debts are only written off as a last resort, but there comes a point where trying to trace the people who owe this money is no longer cost efficient.

"The council tax debts are either from people who are deceased or untraceable. If they were traced in future then we would take steps to collect the money owed, regardless of the fact that the debt has been written off.

"As far as business rates are concerned the debts are written off when a business declares insolvency or bankruptcy. In such instances there is no possibility of collecting the base debt."

Tory leader Councillor Wendy Thompson branded the figure 'extraordinarily high' and questioned whether the authority had done enough to try and recoup unpaid tax.

"I have personally seen cases where I believe more effort could have been made to get the money back," she added.

"It is clear the council has not been robust enough. We are dealing with a huge amount of money.

"As a council we have an obligation to chase every penny to show taxpayers that every effort is being made to recoup this money."

The average business rates write-off was £5,220, while the average value of council tax write offs in the city was £200.

In the last year Wolverhampton council sent out bailiffs more than 11,000 times in a bid to recover unpaid debts.

There are currently 115 cases of unpaid business rates that are the subject of liability orders.

In June, it was revealed Dudley Council was owed £2.5 million in unpaid council tax from last year.

Across the border in Sandwell borough, a total of 19,628 council tax accounts were not paid in full by the end of the 2014/15 financial year. This has left the council needing to chase £2.2m.