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Wolverhampton Council to give up on £600,000 in owed cash

By Richard Guttridge | Wolverhampton | Politics | Published:

A cash-strapped council is to give up on more than half a million pounds owed in tax and other payments.

The Civic Centre base of Wolverhampton Council

Tax unpaid by hundreds of people and businesses is to be written off by Wolverhampton Council.

Council tax totalling £296,195 will be written off after payments were not received in 567 cases as bosses admitted they were unlikely to be able to recover the cash. Bosses said unpaid tax was written off as a "last resort".

The authority will also stop chasing a further £229,499 in business rates, also known as non-domestic rates, from 55 accounts. Unpaid business rates are often related to firms that have closed or gone bust, meaning there is no chance of recouping the money owed.

On top of the tax payments, a report also revealed the council mistakenly overpaid housing benefits to the tune of £25,566. The authority said overpayments "may occur for a number of reasons including as a result of fraud or error". Some £47,614 in money owed from residents and business for council "services" has also gone unpaid. This money will also be written off.

The report said that "in general, overpaid benefit is written off in line with Government guidance where recovery would cause hardship, where the debtor has died or cannot be traced".

Tax write-offs are not uncommon for local authorities but it means the city council, which has said it is facing the biggest financial crisis in its history as a result of Government cuts, will lose out on around £600,000 in crucial funding.

The report said: "Debts are only written off as a last resort, when all feasible recovery action has been exhausted. If the situation surrounding an individual case changes in the future, steps would be taken to pursue the debt, despite the debt having been written off.

It was revealed last week that Cannock Chase Council had been forced to let go of more than £80,000 of unpaid council tax and business rates.

Richard Guttridge

By Richard Guttridge
Investigations Editor - @RichG_star

Investigations Editor for the Express & Star.

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