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Hartlepool council writes off £170,000 in unpaid tax debts

Hartlepool Civic Centre
Hartlepool Civic Centre

Councillors have written off tax debts of over £170,000 after saying there is little prospect of them being paid.

They agreed to give up chasing council tax debts of £35,197.87 including where people have died, absconded or been declared bankrupt.

And taxes owed by businesses of £135,835.55 dating back up to five years have been written out by Hartlepool Borough Council.

John Morton, assistant director finance and customer services, told the Finance and Policy Committee: “We do have very effective recovery arrangements such that after five years we will have collected 99.3% of all council tax and 99.5% of all business rates.

“Members can also be reassured that the council writes out relatively low amounts of debts that are non-recoverable.”

He added: “For council tax the proposed write outs relate largely to people who have died or bankrupt cases, and for business rates the proposed write outs relate largely to sole trader bankruptcies and limited companies liquidation where obviously our prospect of recovery are very marginal.”

The council collects around £44 million of council tax a year and £32.4 million in business rates.

Mr Morton added in 2016-17 Hartlepool wrote out the lowest amount of council tax out of all 12 North East councils and ranked ninth out of 12 for business rates.

Councillor Leisa Smith asked why the council takes people to court over their council tax arrears instead of accepting repayment plans.

Mr Morton said they do accept repayment offers adding the authority has to take people to court to get liability orders to secure their position for later recovery action.

Of the business rate debts, one dated back to before April 2013 as a result of Allied Carpets in Burn Road going into liquidation.

Those after that date were for 19 businesses across Hartlepool that have either been dissolved or gone into liquidation and ranged from £1,200 to £35,000.

Member of the public Ray Pocklington asked why the council waited until debts had mounted before taking action.

Mr Morton said it had “rigorous” recovery arrangements including sending out bills and reminders before seeking court orders to use bailiffs.

He said: “Those arrangements work extremely well and are robustly applied in every case.”

Just over half of the business rates debts (54%) are borne by central government.

Councillors have to give approval to waive debts over £1,000.