Figures obtained by the Derbyshire Times show that Chesterfield Borough Council has written off £594,000 worth of debts during the last year.
A freedom of information request revealed that the largest amount the council wrote off was for unpaid business rates - at more than £237,600.
The second and third-largest amounts between October 2015 and September 2016 were for housing benefits and council rents at £148,500 and £118,800.
Alexis Diouf, leader of Chesterfield Liberal Democrats, said it was very difficult to claw back housing benefit arrears from people who often disappear without a trace.
But he added: “With business rates you often find that these people, for whatever reason, do not pay their rates and then move somewhere else and open up again - often in the same town.
“It is true that businesses are going through a rough time right now but sometimes I think we should be a lot more rigorous in pursuing these outstanding rates.”
Councillor Ken Huckle, cabinet member for business transformation at Chesterfield Borough Council, said the council made every effort to pursue every single debt owed but there were times when it just was not possible.
He added: “The majority of businesses play by the rules and we cannot go to huge costs to pursue a small amount of money but we will issue court summonses.
“My experience in the last five years is the amount of business rates write-offs has stayed roughly the same so any increase above the base rate should set alarm bells ringing.”
Coun Huckle said business rates were set by central government and the borough council had no power to offer lower ones even if it wanted to.
John O’Connell, Chief Executive of the Taxpayers’ Alliance, said: “When councils should be tightening their belts, they really cannot afford not to collect huge amounts of money they are owed.
“Of course there will be those who struggle to make ends meet but councils have to differentiate between taxpayers who cannot afford to pay and those who refuse.
“Council chiefs could make it easier for those struggling by keeping taxes low but also learn the lesson from their mistakes because it is not fair on ordinary, law-abiding taxpayers for others to get away without paying their share.”