Councils Propose Significant Council Tax Increases Amid Budget Crisis

Households across England are bracing for another increase in expenses as numerous local authorities announce plans for substantial council tax hikes set for April 2026. In a challenging financial landscape, many councils are proposing a maximum increase of 4.99 percent, a move that exceeds the current Consumer Price Index (CPI) inflation rate of 3.2 percent. Some councils are even contemplating seeking government approval to exceed this cap, with one authority considering an extraordinary 20 percent rise.

The 4.99 percent increase represents the highest allowable annual adjustment before councils are required to hold a local referendum. This cap consists of a 2.99 percent increase for general spending and an additional 2 percent dedicated to adult social care. In a reflection of the ongoing financial struggles within local government, six councils were granted permission last year to implement increases beyond this cap, allowing for hikes of up to 10 percent.

Several councils are currently finalizing their budget proposals for the upcoming financial year. Among the most notable is North Somerset, where council leader Mike Bell has indicated that the authority may need to raise taxes beyond the 4.99 percent threshold. Bell stated, “Higher council tax rises are now unavoidable if we are to keep essential services running and avoid a financial crisis that would do far more damage to our communities.” He warned that without these increases, there is a significant risk of the council declaring bankruptcy.

Warrington Council is similarly exploring options to raise council tax above the 4.99 percent limit. Denis Mathews, the cabinet member for finance, assets, and investments, described the situation as the “most difficult budget position” in the council’s history. He emphasized that the gap between income and expenditure is widening, stating, “Put simply, the money we receive in income is far less than what we are spending on services.”

In Shropshire, council officials are proposing the maximum 4.99 percent increase but are also consulting residents on potential higher alternatives. The local authority is gauging public opinion on increases of 6.99 percent, 9.99 percent, or even 14.99 percent should they receive governmental consent. Roger Evans, cabinet member for finance, acknowledged the severe financial pressures faced by councils nationwide and stated, “While there are many initiatives underway to reduce spending, they are not sufficient to address the budgetary challenges we face.”

Kent County Council, under the leadership of the Reform UK party, is also set to implement a 4.99 percent increase following an unsuccessful attempt to cut costs. The council, which gained control in the recent local elections, had promised to streamline spending but has struggled to identify significant savings. Diane Morton, cabinet member for adult social care, noted that services are already stretched thin, saying, “We’ve got more demand than ever before and it’s growing. We just want more money.”

As local councils navigate these financial challenges, the implications for households are clear. The anticipated council tax increases could add further strain on budgets, particularly for families already grappling with rising living costs. With many councils indicating that these hikes are vital to maintaining essential services, residents are left to weigh the impact of higher bills in the coming months.