Alex Salmond has provoked a row with Scotland’s council leaders after announcing he planned to ban them from using the updated voters’ register to chase historic poll tax debts. A Guardian investigation has found that 11 councils, including Edinburgh, are planning to pursue unpaid poll tax dating back more than 20 years after 160,000 more people signed up to vote for last month’s independence referendum, pushing Scotland’s electoral roll to a record high of 4.3m.

Scotland’s 32 councils estimate that they are owed £425m in unpaid poll tax built up before the tax, known as the community charge, was scrapped in 1993 after a mass campaign of avoidance and non-payment following its introduction by Margaret Thatcher’s government in 1989.

Although some councils, including Glasgow, Dundee, Fife and Angus, have either written off arrears or have a five-year cap on pursuing debtors, Scottish councils seized nearly £400,000 in unpaid poll tax charges last year.

A majority of Scotland’s 32 local councils have confirmed to the Guardian that they also plan to use the updated roll to pursue other debts, partly, they said, to help soften the steep cuts they have to make in council services.

Those include council tax arrears, false declarations of single occupancy and other non-payments.

The first minister told Holyrood on Thursday he believed it was “misguided” to use the current electoral roll to chase arrears that could be 25 years old, and said the Scottish government planned to ban councils from pursuing poll tax debts.

Salmond confirmed it was legal to use the electoral roll to pursue arrears and said he supported that in most cases. With the council tax, the poorest were already protected through the welfare system. This was not the case with the “hugely discredited” poll tax, which became notorious in Scotland after it was tested there first by Thatcher’s government.

“The relevance of information from the current electoral register to the position of debts from 25 years ago is difficult to fathom, except through some misguided political intention,” he told MSPs at first minister’s questions.

“I can announce today it’s the government’s intention to bring forward legislation to ensure that councils can take no further action to recover ancient poll tax debts. After 25 years, it’s about time that the poll tax was finally dead and buried in Scotland.”

But David O’Neill, president of the Scottish councils’ umbrella organisation, the Convention of Scottish Local Authorities (Cosla), was furious, branding it “the oddest decision ever to come out of the Scottish government”.

He said national and Scottish government policy on using all available techniques to chase arrears had been “crystal clear” until Salmond’s statement at Holyrood, which had been made without any consultation with the councils.

O’Neill insisted councils had a clear duty to chase debts and said Salmond’s proposals implied they would now have to write off hundreds of millions of pounds worth of debt, despite its impact on funding cash-strapped services.

But pro-democracy groups and opposition leaders accused local authorities of abusing the upsurge in political engagement seen in the referendum, alleging that using the electoral roll to chase debtors would be hugely counterproductive.

Willie Sullivan, director of the Electoral Reform Society Scotland, said there was a dangerous conflict between the democratic duty to pay taxes and the fundamental right to vote. But using the electoral roll to pursue debts from the least well-off clearly risked driving the poorest away from voting, undermining democracy as a whole. “Democracy can’t function properly if a whole group of people are excluded from it,” he said.

Despite Cosla’s statement, there are deep divisions amongst Scotland’s local authorities on chasing poll tax debts. Glasgow city council said it believed it was fruitless trying to pursue debts up to 25 years old, because of the complexities of proving someone’s liability after that time.

Aberdeenshire council said it believed the Prescriptive and Limitation (Scotland) Act 1973 barred councils from pursuing any debts which were more than 20 years old. That precluded chasing arrears dating beyond 1994, unless a warrant had been issued for recovery.

Alex Johnstone, the Scottish Tories’ welfare reform spokesman, said forcing councils to write off poll tax arrears was a “tax dodger’s charter”, which undermined the tax system, driven by Salmond’s quest for votes.

“This can only count as a write-off if all councils are fully reimbursed for the money they have not yet received,” Johnstone said. “There is many a person in Scotland who paid this tax in good faith. [Are] those hardworking people going to be reimbursed too under this initiative?”