A MULTI-MILLION pound mansion in Westminster pays just £350 more council tax a year than a two-bedroom terrace house in Bolton, it has been revealed.

While the super rich in affluent areas of London are charged approximately £1,353 for a band H property — the highest — households in Bolton in the lowest bracket, band A, are charged in the region of £1,000 a year.

England and Scotland use property valuations from 1991 to separate houses into eight bands, A to H, with each local authority setting the amount that it requires for council tax.

A band A property in Bolton was worth £40,000 or less in 1991, and a band H in Westminster was worth more than £320,000.

Carole Gimson, aged 59, lives in a small two-bedroom terrace in Westhoughton and is disgusted by the figures. Her council tax for her band A property is £1001.62, and she is shocked that council tax in London does not reflect the value of the properties available.

She said: "I was absolutely livid to find out that the most affluent areas of the UK have the lowest council tax. Once again it is the poorest people who are being squeezed of every last penny while the rich barely scrape the surface.

"It's appalling. I live in a little street with hardly any parking. People in Bolton are already using food banks, fighting the bedroom tax and struggling to make ends meet without being taxed even more."

Despite this, Ms Gimson says she does not think that a "mansion tax" is the answer.

She said: "I think it is too complicated an issue to just slap a tax on mansions. I certainly think that the rich get away with a lot more than the poor but it's not always straight forward and one size does not fit all.

"I think council tax should be lower in more deprived or poorer areas like Bolton because traditionally people who live there don't have spare money to throw at the council, unlike high fliers in posh areas of London, where it should be higher."

A spokesman for Westminster City Council confirmed that it charges the lowest band D rate in the country.

Sean Harriss, Chief Executive of Bolton Council, says the reason for this is that the amount of grant funding from central government is lower than that of places like Westminster, so Bolton Council has to charge more in council tax to balance its budget.

He said: "Council tax varies across the UK, dependent on a number of factors. The most important factor to affect council tax levels is the amount of grant funding which the council receives from central Government.

"Areas such as Westminster and Chelsea receive much higher grant funding from the Government than Bolton, so therefore Bolton needs to charge more in council tax, in order to balance its budget.

"Also, each council has a different reliance on council tax revenue and uses it for a different percentage of their budget. For example, in a relatively wealthy area such as Westminster, the council may receive a large amount of income from parking and from business rates and may therefore need less income from council tax, in order to balance the budget."

He added that the amount which the council charges in council tax is also related to the number of properties in each council tax band.

Mr Harriss said: "Bolton has almost 50 per cent of its properties in Bands A and B, whereas a wealthy area may have the majority of its properties in Bands G and H. So although the council tax may be less in that area, the council may still receive a higher total income from council tax, than in a less wealthy area, such as Bolton."