Council Tax Increases Exceed Inflation in Nearly One Third of Scottish Local Authorities
Almost one third of local authorities across Scotland are set to confirm council tax increases significantly above the current rate of inflation.
Households in Aberdeenshire await confirmation on whether they will face a double-digit rise following Moray Council's approval of a 10% increase on Wednesday, which is more than three times the inflation rate.
Edinburgh and Fife councils have proposed 5% increases, while Dumfries and Galloway and Renfrewshire councils are considering 7.5% rises. Councillors in Clackmannanshire have suggested a 5.6% hike.
Local authorities argue that these higher local taxes are essential to address budget shortfalls amounting to millions of pounds.
East Ayrshire, North Lanarkshire, and Stirling councils are scheduled to meet on Thursday to set their budgets for the upcoming financial year.
Proposed figures remain subject to change as councillors in each local authority will vote on the increases, which are planned to take effect from 1 April.
The Office for National Statistics (ONS) reported inflation at 3% in January, marking the lowest rate since March of the previous year.
Scottish Borders Council was the first to approve an increase, setting an 8.5% rise, which is more than 2.5 times the current inflation rate.
In Glasgow, Scotland's largest local authority by population, the SNP and Greens agreed on a 5.9% council tax increase, expected to be among the lowest in the country.
Three Scottish councils have now approved increases approximately three times the inflation rate.
Alongside Moray's 10% rise, Argyll and Bute council tax will increase by nearly 10% as the authority seeks to close a financial gap exceeding £13 million.
Councillors stated the 9.7% increase is necessary to protect local services and fund investments in roads, social care support, and leisure facilities.
A 9% council tax increase was approved in Midlothian following budget approval.
Comhairle nan Eilean Siar initially proposed a 9.5% increase, but the policy and resources committee supported a reduced figure of 8.5%, which was confirmed on Tuesday.
North Ayrshire Council joined Scottish Borders and Western Isles with an 8.5% rise after the SNP administration's proposed 12% increase was rejected.
Shetland, West Lothian, and East Lothian councils all voted for increases between 7% and 8%.
East Renfrewshire Council announced a 6% council tax increase for the coming year, while South Lanarkshire Council confirmed a 6.5% hike.
Second Year of Significant Council Tax Rises
Aberdeenshire Council officials indicated that without increased income, the council faces a funding shortfall exceeding £17.5 million.
Proposed cuts include reduced school cleaning and grounds maintenance, cessation of road line painting on residential streets, and ending contributions to sheltered housing support.
The approved 10% rise in Moray and the proposed increase in Aberdeenshire are expected to be the highest in Scotland.
Prior to last year, council tax rates had been frozen or capped for much of the past two decades.
Last year saw the largest council tax increases in 20 years across Scotland.
Local authorities maintain that higher local taxes are necessary despite a generous Scottish government settlement, citing many years of restricted funding.
The Scottish government has not attempted this year to impose a freeze or limit increases, although ministers expressed hope that large rises could be avoided.
Where Do Councils Spend Money?
Local authorities are responsible for providing education, social care, public transport, and culture and leisure services.
Funding from the Scottish government constitutes the majority of council finances.
Council tax represents a relatively small portion of each council's budget but is the area where councils have the most control.
For example, council tax accounted for 18% of Glasgow City Council's budget for the 2025-26 financial year.
Although there was a council tax freeze for many years, revenue from the tax has increased in real terms due to new housing developments.
Over the past decade, the general trend has also been a real terms increase in the Scottish government grant.
Councils argue they are now providing more services in areas such as early years provision, free school meals, and adult social care, claiming the additional funding has not kept pace with rising costs.
Consequently, many councils are exploring alternative revenue sources.
Edinburgh will become the first council in Scotland to introduce a tourist tax.
The visitor levy of 5% on overnight stays in hotels, bed and breakfasts, and self-catering accommodations will take effect from 24 July 2026. Approximately £50 million is expected to be raised annually.
