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Council writes off 'irrecoverable' council tax and business rate debts

Council tax and business rate debts worth almost £60,000 have been written off in Cannock Chase.

Cannock Chase District Council

Cannock Chase Council’s cabinet heard on Thursday that 13 cases of council tax debt totalling £34,155.95 and seven business rate arrears totalling £24,005.25 had been deemed “irrecoverable”.

Cabinet members agreed to write off the debts, as well as six housing benefit overpayments totalling £28,595.55. And Councillor John Preece called for information to be published on reasons why some debts had not been recovered, such as the death of a resident, individual voluntary arrangement (IVA) or bankruptcy,

Council leader Tony Johnson said: “I think that is a really good idea. Lots of things that happen are beyond the council’s control.

“Revenue enables the council to be funded to undertake its statutory duties. For the year the total council tax is £63.1m, but we don’t get it all – we only get 12.4%.

“At the end of quarter 2 (July to September period), 54.7% had been collected – a slight increase on the same period last year which was 54.1%, Business rates due for the year are £37m and at the end of the second quarter 55% had been collected – down on the same period last year (56.6%), which was disappointing.

“There are many reasons for write-offs, such as voluntary arrangements, debt relief orders or companies being dissolved. In a difficult economic climate it is difficult to write off debt.”

A report to Thursday’s cabinet meeting said that if further information came forward about the whereabouts of individual debtors the council would pursue recovery action however. It added: “The debts remain legally due to the council and should the circumstances causing the write off in any particular case subsequently change, recovery action may be recommenced.

“The cost of collecting the debts has been considered as part of the decision to put them forward for write off. The amounts being recommended are well below the value of the bad debt provision, which the council includes within its accounts in expectation that some amounts owed will not be paid and cannot be recovered.”

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