Unpaid council tax has hit a record high with £6.6billion owed as 1.8million Britons fall behind, according to a new analysis. The Centre for Social Justice warns that households in council tax debt are more likely to face ill-health, bereavement or a job loss.

It says the value of council tax arrears has surged by more than 80% since the pandemic. The findings land amid fears council tax will increase at the fastest rate in 20 years with local authorities planning hikes of up to 5% to meet funding shortfalls.

The think tank's new report claims 97% of people in tax arrears show at least one sign of "personal vulnerability" - compared to 47% of the general population. They are three times more likely to be in poor health and twice as likely to have experienced "negative life events" - such as the loss of a job, the death of a loved one of the breakdown of relationship.

The average amount of council tax debt held by people seeking advice from debt charities has more than doubled in a decade, up from £756 in 2013 to £1,726 in 2023.

Many people in arrears report a negative impact on their mental health (54%) Others say they have faced threats of legal action (39%), and encountered aggressive collection practices (24%) - with the same proportion reporting strain on relationships with family and friends (24%).

Matthew Greenwood, the think tank's head of debt, said: "With local government on its knees and council tax arrears at record highs, those people who don't pay their council tax even though they have the money should face the full force of the law. But our report shows that the vast majority of those in arrears are not refusing to pay - they're simply unable to, often due to poor health, job loss or other negative life shocks.

"Under the current rules, missing just one payment can make someone liable for the entire year's bill within weeks, triggering bailiff action and, in some cases, threat of imprisonment. It's an outdated, punitive system that fails to distinguish between those who won't pay and those who genuinely can't.

"The Government must now deliver on its pledge to end the unfairness in council tax collection and help put millions on a path to repaying their bills."

John Pears, UK chief executive of debt collection company Lowell, which supported the research, said: "This report highlights what we at Lowell have seen for some time. Many people struggling with council tax debt are also dealing with complex, often hidden, personal challenges.

"The current system doesn't always allow for these realities. It can make it harder for people to get back on their feet. The Government's recent commitment to reform bailiff oversight is a welcome first step, but the work doesn't stop there.

"Meaningful change is desperately needed to protect the most vulnerable."

A spokesperson for the Ministry of Housing, Communities and Local Government said: "Councils remain responsible for setting their own council tax, and anyone currently experiencing difficulty paying their council tax bill should contact their local authority as a range discounts and exemptions are available.

"We are determined to give working families more security though our plan for change, which is why we are consulting on proposals to modernise the billing process and make it fairer and simpler, as well as protecting people against excessive hikes by placing limits on the levels councils set without holding a local referendum."

Toby Murray of Debt Justice, said: "The vast majority of people aren't avoiding council tax, they simply can't afford it. People in council tax arrears are overwhelmingly on low incomes, and many are living in poverty.

"Rather than help, councils are sending in the bailiffs - punishing people for struggling with their bills. Councils should end the use of bailiffs for council tax debt collection and instead introduce urgent reforms, including a duty of care to protect people most at risk."