Local Government Finance (Wales) Act 2024

The Local Government Finance (Wales) 2024 (‘the Act’) delivers a range of reforms to the non-domestic rating and council tax systems in Wales.

The Act, in respect of non-domestic rates:

• increases the frequency of revaluations to three-yearly, and provides a power for the Welsh Ministers to amend the revaluation year and interval between revaluation years through regulations;
• confers regulation-making powers on the Welsh Ministers to confer, vary or withdraw reliefs;
• strengthens the eligibility conditions for charitable relief for unoccupied hereditaments;
• expands the definition of a new building for the purpose of the serving of completion notices by billing authorities;
• removes a timing restriction on the awarding and varying of discretionary relief by billing authorities;
  confers regulation-making powers on the Welsh Ministers to confer, vary or withdraw exemptions;
• confers a regulation-making power on the Welsh Ministers to set differential multipliers based on the description, rateable value or location of a hereditament on the local list, or the rateable value of a hereditament on the central list;
• places a duty on ratepayers to provide certain types of information to the Valuation Office Agency, and makes provision for the associated compliance regime; and
• makes provision about counteracting advantages arising from artificial avoidance arrangements.

The Act, in respect of council tax:

• provides flexibility for the reference point for 100% in the banding structure to be changed to a different band or a different description of a band;
• confers powers on the Welsh Ministers to make regulations in respect of discounts and persons to be disregarded from calculating liability;
• places a duty on the Welsh Ministers to make a single national Council Tax Reduction Scheme through regulations and enables the Welsh Ministers to issue guidance to billing authorities about the way the scheme is applied; and
• establishes a five-yearly cycle of revaluations from 1 April 2028, and provides a power for the Welsh Ministers to amend the revaluation year and interval between revaluations, as well as to amend the date of a draft list publication via order.

The Explanatory Notes to the Act provide detailed commentary on the various provisions.
 

Coming into force

The Act comes in forces as follows in accordance with section 23:

• sections 1, 16, 21, 22, 23 and 24 and paragraph 13(3)(b) of the Schedule (and section 15 in so far as relating to paragraph 13(3)(b)) came into force on the day after the Act received Royal Assent (namely 17 September 2024);
• sections 2, 3, 4, 5, 7, 8, 9, 13, 14, 17 and 20 and Parts 1, 2, 3, 6 and 7 of the Schedule (and section 15 in so far as relating to those Parts of the Schedule) come into force two months after the Act received Royal Assent (namely 16 November 2024);
• sections 6, 10 and 11 and Part 4 of the Schedule (and section 15 in so far as relating to that Part of the Schedule) come into force on 1 April 2025; 
• section 18(2)(c) and (5), for the purposes of making regulations under sections 6 and 11E of the Local Government Finance Act 1992, came into force on the day after the Act received Royal Assent (namely 17 September 2024). For all other purposes, section 18(2)(c) and (5) comes into force on a day appointed by the Welsh Ministers in an order;
• the other provisions of the Act come into force on a day appointed by the Welsh Ministers in an order.

Subordinate legislation made under the Act:

Consideration of the legislation by the Senedd

The Bill was introduced to the Senedd on 20 November 2023 by Rebecca Evans MS, who was the Welsh Government’s Minister for Finance and Local Government at the time. It was passed by the Senedd on 16 July 2024 and received Royal Assent on 16 September 2024.

More information about the Act is provided on the Senedd website including a record of the Bill’s passage through the Senedd.

The Explanatory Memorandum  that was prepared by the Welsh Government to accompany the Bill was updated following Royal Assent.
 

Related articles and information

• Senedd Research produced a range of materials to explain the proposals contained in the Local Government Finance (Wales) Bill. 
• The Welsh Government undertook a consultation on proposals for reforming non-domestic rates, which informed the development of the Act. The consultation ran from 21 September 2022 to 14 December 2022. 
• The Welsh Government undertook a phased approach to consultation on council tax reform, which informed the development of the Act. A Phase 1 consultation ran from 12 July 2022 to 4 October 2022, and a Phase 2 consultation ran from 14 November 2023 to 6 February 2024. 
• An impact assessment on the non-domestic rates provisions was published.
• An impact assessment on the council tax provisions was published.
• A suite of information on council tax reform is available on the Welsh Government’s website. 
• A summary of findings from research completed during the Fifth Senedd on potential options for the reform of local taxes in Wales is available on the Welsh Government’s website.