Waltham Forest Council acted against government guidelines when giving most of its councillors dispensation from declaring interests.

The authority said 59 out of 62 of its councillors were exempt from declaring interests to allow them to make decisions about council tax.

But a government document brought to the Guardian's attention directly contradicts this.

It says councillors are not exempt from declaring interests simply because they pay council tax.

In 2015, a total of 43 Labour councillors, including council leader Clare Coghill and deputy leader Clyde Loakes, and 16 Conservative councillors, including Conservative group leader Alan Siggers, were all under no obligation to declare their interests because of this "loophole."

Resident David Gardiner, who has highlighted the issue, said:  "The council has been allowed to get away with granting itself immunity from disclosure on completely trumped-up and meaningless grounds.

"It has done this on the strength of which they have shed their responsibility to disclose any pecuniary or non-pecuniary interests of any kind in anything.

"These people deal every day with multi-million-pound sums of public money and have simply decided to give themselves immunity from the need to disclose any personal interest that they may have in the decisions they take – because they pay council tax?

"Is that the action of a group of people with nothing to hide? How strong does the smell need to become before we acknowledge that we have rats in the larder?"

In May, John O’Connell, chief executive at the TaxPayers’ Alliance said: “Residents have a right to know about their councillors’ interests as a central tenet of democracy.

“This is especially important considering the increasing amounts of taxpayers’ money councillors take every year.

“Sunlight is the best disinfectant and these councillors should give up these dispensations immediately.”

A council spokesperson said: “The first page of the MHCLG guidance states that the guide ‘should not be taken as providing any definitive interpretation of the statutory requirements’ and that councillors should seek legal advice if unsure.

“We have erred on the side of caution. We accept that members may well have been fully entitled to vote on issues around council tax even if this dispensation was not granted.

“The general dispensation does mean that time can be saved at the beginning of council meetings without each councillor having to declare council tax liability.”