HAMBLETON District Council is among nine authorities in England in line for capping after failing to abide by strict guidelines to keep increases below 5.5 per cent.
The council must cut its council tax bills or be capped so it can 'learn a lesson', Local Government Minister Nick Raynsford said.
It has two weeks to decide whether to cut bills voluntarily or challenge the decision that the rise - due to come in next month - is excessive.
If council leaders refuse to back down the General Election, expected in May, will provoke chaos, with readjusted bills unlikely to be sent out until August at the earliest.
Council taxpayers would then have to pay the higher amount for the first six months of the financial year, with much lower payments in the autumn and winter.
Branding it ludicrous, council leader Arthur Barker said its proposed band D rise of £12 a year worked at only 23p per week. At £80, the charge would be £100 below the Government's target. He said: "The council is being penalised for having set one of the lowest council taxes in the country for many years."
But Mr Raynsford said what was important was the rate of increase - 17.6 per cent in Hambleton's case - rather than whether the overall bill was high or low.
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