CALLS have been made for West Somerset Council to bite the bullet and increase its Council Tax precept this year, rather than losing thousands of pounds in income by taking a one-off Government grant top-up instead.

Despite being told by finance lead Cllr Kate Kravis that money was so tight at the authority that "every penny counts", cabinet members agreed on Wednesday to take a £50,000 grant from Government rather than bringing in £70,000 by putting Council Tax up by 3.5 per cent.

Council leader Cllr Tim Taylor said it was better to bring £20,000 less cash into the district by taking £50,000 from Westminster, rather than taking £70,000 directly from West Somerset Council Tax-payers.

But he warned that the shortfall would still have to be found next year with the authority likely to seek the delayed 3.5 per cent increase on top of any additional hike in 2013/14 Council Tax bills.

Although no potential tax-rise figure was discussed publicly by councillors for the next financial year, it has been widely anticipated to be around the 20 per cent mark to try and bring the authority's low Council Tax base up to the same level of similar district councils.

But any increase above the Government's anticipated 3.5 per cent capping limit will incur the need for the council to hold a referendum to ask taxpayers if they would be prepared to foot the extra bill.

Cllr Taylor said: "By taking the £50,000 Government grant, we are saying loud and clear [to taxpayers] we will save you £50,000 but the 3.5 per cent will need to go back on top of whatever we put into a referendum after next year's budget.

"We will allow the people of West Somerset to take the decision on whether to allow us to have a Council Tax figure including the 3.5 per cent.

"By putting on 3.5 per cent now will be removing the decision from the people of West Somerset."

Cllr Taylor said the final increase needed by the council next year to stave off widespread cuts would not be known until the Government had finalised details on a new local government funding formula.

"We are continuing to look at reducing the costs of this council and in 2015/16 we will face a budget gap of £1.3 million.

"The stark reality is we need to raise substantially more through Council Tax if we are to keep the £600,000 we spend on discretionary services.

"If we don't get the extra £1.3 million, we know we will be cutting all discretionary services and will have to make huge inroads into the quality of the statutory services.

"It's going to be difficult so we will have to come down to a referendum on our Council Tax," Cllr Taylor said.

But opposition councillors questioned the logic of delaying an increase when bills could legitimately be put up by 3.5 per cent this year.

Cllr Keith Ross said he believed the ruling cabinet was wrong to be pushing to keep the status quo by taking the Government grant instead.

"Government money still has to come from somewhere . . . every penny is our taxes.

"If we don't put it up by 3.5 per cent, we'll be doing West Somerset residents a disservice in the future," Cllr Ross said.

Cllr Andrew Hadley agreed: "In past years we haven't put the precept up enough and we would not be in the mess we are in now if we had."

Historically, the district council had a policy of keeping Council Tax increases to the bare minimum, something that was now costing it hundreds of thousands of pounds in lost revenue.

Cllr Peter Murphy said he had been heartened when the council's ruling Conservatives previously produced a budget, working on the premise the Council Tax would rise annually by at least 3.5 per cent.

"I thought at last this council was acknowledging it did get it wrong in previous years.

"If we had put up Council Tax from 2000 by the national average, a Band D property would be paying £167.02 instead of the current £132.90 and we would have received £500,000 more income in 2012 if we had done it right in the past.

"If we put it up by 3.5 per cent that would a £4.65 difference on a Band D property.

"I do not think that is a significant amount.

"The message that will send is this council has to put up tax and is taking things seriously.

"I don't see the attraction of taking a one-off grant this year and I don't believe it is beneficial to West Somerset.

But Cllr Martin Dewdney supported the cabinet and said it would be wrong for the authority to increase its precept when other authorities were freezing theirs.

"I don't see why we should put it up. It makes very little difference to our financial gap.

"There's no point having a history lesson, that money isn't there," he said.

Avon and Somerset Police Authority and Somerset County Council had already declared their intention to freeze their share of Council Tax bills, although Taunton Deane Borough Council this week decided to increase its precept by 3.45 per cent.

Taunton Deane leader Cllr John Williams said the increase would amount to a nine pence a week increase for a Band D property and would help the council close a £2.1 million funding gap.

In West Somerset, district councillors have made no secret of the fact they too face some tough choices in the coming years as the authority battles to try and remain financially viable.

This year alone, councillors will be asked to approve almost £160,000 in savings as part of a battle to cut over £1 million from its budget in the coming years.

Cabinet members agreed to recommend a freeze in Council Tax, although the final decision will be taken by the full council later this month.