Millions of households in England will see council tax hikes exceeding the usual limit after the government granted exemptions to six areas, allowing them to surpass the 5% cap on increases.
Typically, councils with social care responsibilities can raise council tax by up to 4.99% without a referendum, while others are limited to 2.99%. However, Deputy Prime Minister Angela Rayner confirmed that Bradford Council will be permitted a 10% increase, while Newham and Windsor and Maidenhead can raise taxes by 9%. Birmingham, Somerset, and Trafford have been allowed a 7.5% increase.
Rayner defended the decision, stating that these increases are necessary to prevent further financial instability for struggling councils. She emphasized the need to balance these measures with taxpayer interests.
The government denied several councils’ requests to exceed the 4.99% cap, including Hampshire, which sought a 15% hike.
In a broader funding update, the government announced that councils will have access to over £69 billion this year—a 6.8% cash increase compared to 2024-25. No council will experience a reduction in core spending power, with over £2 billion coming from direct grants beyond council tax revenue. Additional funding will also be provided to cover rising employer National Insurance costs.
Despite the financial boost, Local Government Association chair Louise Gittins warned that council finances remain under severe strain. She stressed that while tax increases may provide much-needed funding, they won’t fully address the financial shortfall, forcing councils to make further service cuts. She called for a long-term, sustainable funding model with substantial increases in government support.
