This year's rise in Council Tax is to be the central target of the Liberal Democrats during the forthcoming local election battle.
Mr Kennedy hopes to gain from both his rivals
They have pledged to cut £100 from every bill as part of their bid to win more council seats from Labour and the Conservatives.
The Lib Dems also said they want to scrap the tax and replace it with their long-promised local income tax which they believe reflects ability to pay.
Party leader Charles Kennedy also stressed other Lib Dem tax plans including a new 50% top rate for those earning more than £100,000 a year.
He said the extra revenue would be used to abolish new charges associated with going to university such as top-up fees.
"I think this is something that will ring with people," Mr Kennedy said.
"It is something that people will see as fair in terms of the ability to contribute and it will achieve something worthwhile."
The local income tax rate would probably be about 3p of each pound earned.
The party is adopting the slogan: "Every Liberal Democrat vote is a vote towards scrapping the
The move is an attempt to change this year's local poll into a referendum on the council tax.
The Lib Dems hope that despite international events, the elections will be decided on local issues.
Mr Kennedy acknowledged that war with Iraq was a "huge issue" for voters but added that he hoped it would not be the "determining issue".
"People exercising their democratic right should think about things at a
local level that matter to them," he said.
Lib Dem local government spokesman Edward Davey said that his party was "very positive" about its prospects in the forthcoming election and was hoping for "net gains".
He said that council tax was "grossly unfair" as it hit pensioners and those on fixed incomes "especially hard".
He said: "It was rushed in by the Conservatives as the next worst thing after the Poll Tax fell apart.
"It beggars belief that Labour have kept this unfair Tory tax."
Among the Lib Dems' key targets are seats in high-profile Tory constituencies such as in Conservative chairman Theresa May's Maidenhead seat.
They are also hopeful of their prospects against Labour in York, Wansbeck and Watford.
Another frontbencher, Mark Oaten, later announced that two local councillors in Watford had defected to the Lib Dems - one from Labour and one from the Conservatives.
Mr Oaten said that the decision of the two local politicians to switch sides was more evidence that his party was going "from strength to strength".