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£29.00Local councils in Scotland, representing approximately two million residents, are preparing to implement the largest council tax increases in two decades. After a period of nationwide freeze, Edinburgh, Glasgow, Fife, Scottish Borders, and North Lanarkshire councils are finalizing their new rates. The Borders council is looking at a potential 10% increase, while Edinburgh and Glasgow may see an 8% and up to 7% rise, respectively. North Lanarkshire is considering a 10% hike, with Fife proposing an 8% increase.
These new rates, expected to be well above the latest inflation rate of 3%, will be officially determined at council meetings scheduled for Thursday. The trend started with East Lothian council announcing a double-digit increase. Glasgow City Council, the largest local authority in Scotland, is under financial strain, facing a deficit of £7.9 million even before factoring in council tax increases. This has led to protests by unions outside the city chambers, urging councillors to avoid imposing cuts.
Over the past two decades, council tax rates have either been frozen or capped, but the government subsidy for the freeze ends in April. Finance Secretary Shona Robison has assured a funding package of over £15 billion for local authorities in the 2025-26 budget to help mitigate the need for significant council tax increases. However, financial concerns are looming, especially with the UK government’s plan to increase National Insurance contributions, prompting Robison to pledge to cover 60% of the associated costs. Despite this, Scottish local authorities are still anticipating a £100 million shortfall due to the UK tax hike.
The SNP administration has long promised to reform the council tax system since coming into power in 2007. A joint consultation between the Scottish government and council body Cosla was recently announced to address the issue, but any changes are unlikely to be implemented before the parliamentary term ends in May 2026. This could have a disproportional impact on poorer households, as council tax rates are based on house valuations from 1991, often affecting them more than wealthier households
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