Mr Byers is seen as close to the prime minister

Poorer people are paying a contribution disproportionate to their wealth, Mr Byers will say.

He will tell a local government conference on Thursday the council tax is unsustainable and must be replaced.

"The poorest 10% pay over four times more of their income in council tax than the richest 10%," he will say.

Nods and winks?

Deputy Prime Minister John Prescott said Mr Byers' remarks were the "private musings of a backbencher".

"They do not represent government policy," he said.

But Liberal Democrat spokesman Edward Davey said it was significant that a "close ally of the prime minister" wanted to distance himself from this "unfair tax".

Rising council tax bills have seen protests around the country

"Speeches by former cabinet ministers, leaks to the national press combined with nods and winks, are no substitute for action," he said.

House of Commons library figures suggest the contribution that business makes has fallen from 30% to 24% because it has been pegged to inflation since 1993.

The burden faced by domestic council taxpayers has meanwhile increased from 23% to 29%.

The current average for a Band D property is nearly �1,100 - a figure that would be �234 less if the proportion was the same as it had been in 1993.

'Unsustainable'

Pensioners have nearly twice the average person's burden when it comes to council tax, Mr Byers will argue.

"So it is pensioners and those in poverty who are paying the price for the business rate being pegged to inflation," he will tell the New Local Government Network conference.

"The present system of council tax is unsustainable. It needs to be replaced by a new system which protects pensioners and those in greatest need while ensuring that business pays its fair share."

The timing of the ex-transport secretary's speech coincides with mounting speculation the government wants to reform council tax.

Weekend media reports suggested it could be replaced by a combination tax that would take account of both income and raise a levy on property.

Demonstrations

A review of local government funding is due to report this summer.

Many council tax bills are set to rise again this year, following an average rise in bills of 12.9% last year.

Last year's rises sparked demonstrations in many parts of the country.

Many of those were staged by pensioners who want the system scrapped and replaced with one based not on property values, but on ability to pay.

Ministers have warned 65 authorities planning big rises to have a rethink or face a government tax cap.