What is council tax and how much is it going up?

Councils in England have until 11 March to decide how much to put council tax up by and whether services need to be cut. Those with social care duties can raise council tax by up to 4. 99%, without triggering a referendum. Millions of households are expected to see their council tax bills rise in April.

Councils can increase bills by more than 5% without a referendum. In April, 75% of councils are expected to introduce the maximum increase. Woking Borough Council can raise council tax by up to 10%, while Thurrock and Slough can put bills up 8%. In Wales, a 16% increase has been recommended for Pembrokeshire.

Council tax is set by local authorities to raise money for providing services. Most people pay in 10 monthly instalments then don’t pay anything in February and March. How much you pay depends on what council tax band your property is in. The more expensive the property, the higher the band.

Council tax bills also include additional charges - called levies - which pay for other services. One goes towards the cost of care homes and other adult social care services. Another is set by local police and fire authorities to help fund their services. Some cities with mayors, such as London and Manchester, can also add a separate levy.

Councils will have seen a 27% fall in spending power since 2010, LGA says. Cuts in central government grants, rising inflation, higher energy costs and increases to the National Living Wage are all factors. Nottingham City Council, which is effectively bankrupt, said reduced government funding was one of the reasons it had to approve hundreds of job losses. Birmingham City Council went bust in 2023, with a £760m black hole.

Since then, there have been more than 10 such notices. Local Government Association said in October that councils in England face a £4bn funding gap over the next two years.

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