UK appeals court overturns council tax ruling

Can an occupier of a property apply for a reduction in his council tax banding because traffic levels on an adjacent stretch of motorway have increased so much that the resulting noise and pollution have reduced the value of his property?

This is exactly the question that the court of appeal was asked to consider.

Residents living close to the M61 in Bolton applied for a reduction in their council tax liability claiming that an increase in traffic, noise and pollution had reduced the value of their properties. Although the council tax valuation officer accepted that traffic levels had increased, he considered that it was only an environmental change and not a physical change and therefore, would not justify a reduction of the council tax by reason of a material reduction in value.

The householders appealed the valuation officer’s decision to the valuation tribunal who, in favour of the householders, decided that the increased noise and pollution levels had caused a change in the physical state of the dwellings locality that had impacted on the value. The valuation officer appealed this decision to the high court, but the tribunal’s decision was upheld, resulting in recourse to the court of appeal.

In delivering its judgment the court of appeal stated that the circumstances in which council tax payers could apply for an alteration to their valuation banding were extremely limited and that although the Local Government Finance Act 1992 allowed for a reduction in the value of a dwelling due to a change in the physical state of the dwelling’s locality, given the tight limitation, it would be contrary to the policy of the Act to permit an alteration for a reason, which, although manifesting itself locally, was part of an overall nationwide trend.

The court believed that to interpret this otherwise would be to use a limited measure as a wider opportunity to revalue properties on the basis of something which is happening throughout the land. In delivering its judgment the court said that the valuation officer is only concerned with the essential fabric and character of a house and its locality, not with matters of use, activity, enjoyment or occupation such as the particular volume of traffic on a particular date.

In allowing the valuation officer’s appeal, and distinguishing situations where the fabric or character of a road had changed as a result of the addition of an extra lane to a motorway or where a quiet street became a rat run, the court held that greater levels of traffic on a motorway which had not changed at all in its physical state was not capable of coming within the statutory language of the Local Government Finance Act 1992, and therefore couldn’t be used for the purposes of a res-assessment of council tax.

The full judgement of the court of appeal can be found here.

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