Council tax is to be frozen or reduced in every local authority area in England this year, Communities Secretary Eric Pickles confirmed today.
That will make it the first year since the tax was introduced in 1993 that it has not risen.
The freeze was funded by £650m provided by Mr Pickles' Department for Communities and Local Government to support councils which opted not to increase their bills.
Official statistics published today show the average Band D council tax set by local authorities in England will remain unchanged at £1,439 for 2011/12 as a result of a 0% increase on last year's council tax level.
Some 378 councils have frozen the tax and 43 have reduced it. 'This Government has made sure that for the first time ever council tax bills have remained frozen all over the country this year - saving some local tax-payers up to £72,' Mr Pickles said.
'We are standing up for the hard-pressed taxpayer who watched their council tax bill double. Tackling public debt is our highest priority but we are determined to protect hard-working families and pensioners who have been squeezed for too long. This is about giving real and immediate help to families struggling with the daily cost of living.
'As well as special funding that has ensured councils freeze their bills, the Government has scrapped a council tax revaluation and in the future residents themselves will have the right to veto excessive increases in local referendums.'
Every eligible English local authority will now receive an additional grant from the Department for Communities and Local Government equivalent to them having increased their council tax by 2.5 per cent, paid in 10 equal instalments from April.
The new council tax levels come into effect from April. Some areas may see a small increase in the figures on bills, as parish councils are not covered by the freeze arrangements and could be imposing a hike in their share of the tax.
News of the council tax freeze comes on the day Chancellor of the Exchequer George Osborne unveils the 2011 Budget.
Mr Osborne is expected to unveil a tax cut of up to £320 a year for millions of workers as well as a freeze on air passenger duty and increases in the price of cigarettes and beer.
Neil Duncan-Jordan, of the National Pensioners Convention, earlier this month welcomed the move to freeze or reduce council tax payments, but warned that older people could see some services cut and be charged more for others.
He added: 'This is a double-edged sword for pensioners. People like the idea of a council tax freeze but older people are more reliant on local government services and the implications of cuts to services could leave people worse off, even if they are not paying more.'
From next year councils will have to hold a referendum if they want to impose 'excessive' increases in council tax. But Margaret Eaton, Tory chairman of the Local Government Association, said the latest figures showed the new powers were unnecessary as councils were already acting 'responsibly'.
She said: 'Councils have had to take incredibly tough decisions to balance the need to protect frontline services while providing value for money for the taxpayer.
'They deserve credit for keeping council tax to a minimum, meaning more money in the pockets of residents, at a time when they are facing unprecedented financial pressures.'