Biggest council tax rises in 20 years confirmed

The biggest council tax increases in 20 years have been confirmed by five local authorities across Scotland as a nationwide freeze comes to an end.

North Lanarkshire and Scottish Borders councils voted for 10% increases, Fife went for 8.2% and councillors in Edinburgh backed an 8% hike.

In Glasgow, the largest council, the ruling SNP group agreed a 7.5% rise with support from the Greens, with some of that ring-fenced for more street cleaning.

Local authorities claim higher local taxes are necessary, despite a more generous Scottish government settlement, because of many years of restricted funding.

The five councils have a combined population of about two million people and the rises are well above the latest rate of inflation of 3%.

North Lanarkshire Council said its 10% rise would allow it to invest in three new community hubs, including new primary schools, with no cuts to services.

Scottish Borders Council agreed the same increase without the need for a vote.

Council leader Euan Jardine said for many years the Borders had some of the lowest council tax rates in Scotland, but a sharp rise was now needed.

"Ultimately members across the political spectrum agreed it was necessary to protect frontline services and make investing in communities a priority," he said.

Three Scottish councils have now agreed double digit increases, after East Lothian set a 10% rise in its budget two days ago, and Moray has indicated it will do the same next week.

Glasgow City Council, the largest local authority by population, had earlier warned it was facing a funding gap of £7.9m before council tax increases were factored in.

The ruling SNP group and Green councillors agreed on a 7.5% rise with £6.75m ring-fenced for 200 extra street cleaning staff as well as maintenance of roads, pavements and parks.

Unions have claimed the city is facing a crisis in its cleansing services, with uncollected rubbish and rat infestations in some areas.

Glasgow City Treasurer Ricky Bell said the rise, combined with this year's settlement from the Scottish government, meant "we finally have some cash to invest" in frontline services "after years of austerity".

"We'll deploy those staff where they can have the most impact, including dedicated Neighbourhood Clean Teams who will be able to respond promptly to issues within communities," he said.

In Edinburgh, the budget was passed after 11th-hour negotiations between the minority Labour administration and councillors from the Lib Dems and Conservatives.

Labour priorities on funding for temporary housing and schools were retained, while the Lib Dems secured £1.6m for road safety and blocked cuts to pupil support assistants.

The Tories secured £1m for reforms of the joint board that delivers health and social care funding.

In Fife, an SNP proposal for a 6.4% increase was defeated when the Conservatives and Lib Dems backed the minority Labour administration's 8.2% rise.

Council leader David Ross accepted the rise would have an impact on families, but said the alternative was to cut back on vital local services.

Council tax rates have been frozen or capped for much of the past 20 years.

In the current financial year, the government subsidised a nationwide freeze but that ends in April.

Other than 2023-24 - when many councils raised rates by about 5% - this is the first time for almost 20 years when a big increase has really been possible.

First Minister John Swinney said there was an extra £1bn of funding for councils in the 2025-26 Scottish Budget, taking the total government grant to about £15bn.

"I accept that there will be increases in council tax," Swinney told reporters at the Scottish Parliament.

"But I think what the government is doing is investing in, and supporting, local authorities. Obviously, we've had to deal with enormous financial pressures."

Council body Cosla said a combination of previous freezes, inflation and higher costs such as national insurance contributions meant councils were having to make "difficult decisions".

Resources spokesperson Katie Hagmann said: "Council tax is one of the few options councils have to raise money to invest in local improvements such as roads; community halls and leisure centres; and public transport.

"These are services that benefit us all, but especially the people in our communities who might need extra support – such as children and young people, parents with young children, elderly people, or those with disabilities."

Citizens Advice Scotland (CAS) said it was worried about the impact the rises would have on people who were already struggling with their finances.

Myles Fitt, CAS financial health spokesman, said: "Council tax debt is the single biggest debt the Scottish Citizens Advice Bureau network deals with each year and our fear is these rises could further increase numbers of people falling into debt or falling further into debt.

"We urge councils to do everything they can to raise awareness of the various council tax reductions that are available so that those that are eligible to pay less have that opportunity in the face of these rises."

Local authorities warned before the Budget announcement that they were facing a funding gap of almost £400m.

Financial concerns have been heightened by the UK government's plan to increase National Insurance contributions.

Finance Secretary Shona Robison has pledged to cover 60% of the associated costs, but Scottish local authorities say they are still facing a £100m shortfall as a result of the UK tax hike.

Council tax rates are based on house valuations from 1991, with increases often hitting many poorer households harder than better off ones.

The Institute for Fiscal Studies (IFS) think tank estimates that more than half of Scottish homes are in the wrong council tax band.

IFS senior economist Stuart Adam said: "If you do a revaluation we estimate that 57% of properties would change bands, just under 30% would go up a band, just under 30% would go down a band."

The SNP administration has been promising to reform the system since coming to power in 2007.

Earlier this month, the Scottish government and Cosla announced a joint consultation on the issue.

But with the parliamentary term scheduled to end in May 2026, there will be no change before then.

Funding from the Scottish government makes up the bulk of council finances;

• 66% Scottish government grant
• 19% council tax
• 15% business rates

Local authorities are responsible for providing education, social care, public transport and culture and leisure.

Glasgow City Council, for instance, spends about £830m on education and £570m on social provision.

While there has been a council tax freeze for many years, revenue from the tax has risen in real terms because of new homes being built.

Over the past decade, the general trend has also been for a real terms rise in the Scottish government grant.

Councils, however, argue they are now providing more services in areas such as early years provision, free school meals and adult social care - and they claim the extra money has not kept pace with extra costs.