Tories call for council tax referendum

LONDON (Reuters) - Councils should be forced to hold a referendum if they want to introduce local tax increases above a set threshold, Conservative leader David Cameron said on Tuesday.

Under the Tory plan, councils would be obliged to poll residents on tax rises if the hike passes a "trigger threshold", which would be set by parliament.

If most people voted against a council tax rise, they would receive a rebate the following year.

Currently, council tax is capped in England and Wales at a figure set down by central government.

Cameron told BBC radio that the proposal was about devolving central power and encouraging democratic accountability.

"I think it's right to give people the ultimate say," Cameron said.

"If a council had a very specific proposal and they wanted to take that to the people and say 'here is the case for paying more taxes for this extra service', then they would be able to do so.

"At the moment they're completely incapable of doing that because the cap falls from ministerial diktat, and under our system it would be local people saying so."

However, Tony Travers, director of the Greater London Group at the London School of Economics, was sceptical.