Scotland Finance

Stick or twist: raising council tax


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For the first time in 10 years, councils in Scotland have the ability to raise council tax. Charlotte Maddix takes a look at who’s likely to use this ability – and what it means in light of the 2017 local elections.

Glasgow has announced it will increase its council tax by 3%. West Dunbartonshire will also increase council tax by 3% – at the same time dropping a number of contentious cuts in favour of using up reserves. Edinburgh, Falkirk and Fife may also raise their council tax. Scottish Borders and Highland Council have also indicated they might go for a rise.

These rises won’t, of course, fill the holes in council’s budgets. Glasgow’s move raises £7 million – but they need to find £67 million. For most councils, raising council tax would have a minimal impact on the actual cash available to them.

So what about those councils that choose to stick with the freeze? South Lanarkshire is reportedly leaving council tax alone for at least another year. As councillors reach their decisions in the coming weeks, other councils may choose to stick. After all, any increases made this year will take effect shortly before the 2017 local elections. Local authorities will be looking to minimise impacts on their constituents’ pockets – but will be very aware of the pressing need to increase the council’s income.

Meanwhile, last year’s vote in the Scottish Parliament on council tax bands mean that everyone will be paying more this April. Householders in the highest band will be paying £10 more a week. This move was made against a backdrop of hopes for fundamental tax reform in Scotland, disappointing some – although Scottish Government have portrayed the rise as the first steps on the road to reform.

South of the border, Surrey has proposed raising its council tax by 15% – levels Scottish councils can only dream of. Nine in ten English authorities are planning on raising council tax. Many will raise it by almost 4% – just below the limit after which a local referendum is required. Even that is certainly more than any Scottish local authority seems to be contemplating.

Local elections are inevitably used to highlight the achievements – and shortcomings – of national governments. Opposition parties will surely seek to criticise the SNP’s incremental approach to council tax reform. Local political situations being what they are across Scotland, local parties may diverge massively in how they play the political football that is the council tax freeze. The SNP’s message is that they’re investing massively in local services. How voters interpret the situation is, right now, anyone’s guess. Will they care that council budgets are under pressure? And is there going to be a debate on how the public want local services to be funded?

For more details on this topic, look out for next week’s member-only briefing on the 2017/17 local government settlement.