Speaking at the Conservative conference in Birmingham today, Shadow Chancellor George Osborne said he hoped the move would help families struggling with the rising cost of living by saving a typical band D household over £200.
He said: “Instead of council tax bills that rise year after year under Labour, millions of families will get help at the time they need it most. Conservatives will not leave people to struggle with the credit crunch alone.”
The Conservatives said the cost of the council tax freeze would be shared between local and central government.
Any council that makes savings to keep its annual council tax increase to 2.5 per cent or below will receive additional money from central government to reduce council tax bills by a further 2.5 per cent.
This central government funding will be raised by reducing spending on expensive private sector consultants and advertising by £500m in the first full year of government, and by £1bn in all subsequent years.