Council tax bills to soar 27pc under Labour
Council tax bills will soar by nearly 30pc under Labour, with residents in 28 areas hit with £3,000 average bills, analysis shows.
Campaigners said the figures poured cold water on promises made by Rachel Reeves, the Chancellor, last week that households would be £500 a year better off thanks to this Government.
Figures, compiled by the Taxpayers' Alliance on behalf of Telegraph Money, revealed a typical Band D house will be paying £2,750 a year by 2030, the end of Labour's first term. It amounts to a 27pc hike from 2024.
Residents in Rutland will be hit hardest, with a £3,220 bill, closely followed by £3,218 in Nottingham and £3,150 in Dorset.
Town halls in 25 other areas, including Gateshead, Bristol and Lewes will also charge residents more than £3,000.
It comes after Ms Reeves used her Spring Statement to claim households will be 'over £500 a year' better off thanks to higher wage growth forecasts by the Office for Budget Responsibility.
The watchdog said it expected 'real household disposable income per person to grow at an average of around 0.5 per cent a year in the five years from 2025-26 to 2029-30'.
But for residents in Rutland, whose council tax could soar from £2,667 to £3,228, this £500 would be entirely wiped out by the increased bill, leaving them £61 worse off.
The news will strike a blow to the countless families who are already stretched thin by exorbitant council tax. This week, inflation-busting increases came into effect, with nine in 10 councils raising bills by the maximum amount allowed.
Kevin Hollinrake, shadow minister for Local Government, criticised Rachel Reeves's 'brass neck' to suggest she is improving people's lives.
He said: 'Council tax has gone through the roof under Labour. This is the beginning not the end, with things set to get even worse. Even more inflation busting council tax rises will clobber middle England again and again.'
By 2030, 42 councils will issue bills of £2,900 and higher, while a further 71 will charge residents more than £2,800, according to the Taxpayers' Alliance. This means 40pc of households in the UK will have bills of £2,800 or higher in five years.
The average national wage, post tax, is roughly £30,000, meaning that typical households across the country will be forking out 10pc of their salary on council tax by the end of the decade.
Councils with social care responsibilities are allowed to increase council tax by a maximum of 5pc without a referendum. It is 3pc for authorities such as district councils.
The analysis is based on the assumption council tax will be permitted to increase by the maximum amount each year, looking at the 296 district, borough, metropolitan and unitary authorities.
Labour has already allowed this once, following the move by the previous government in 2023. The Autumn Statement in 2022 changed the upper limit that councils can increase tax to 3pc for all local authorities, with an extra 2pc for those with social care responsibilities, such as unitary authorities.
The Government has already been accused of misleading voters after its election campaign claimed that households wouldn't pay a penny more in council tax under Sir Keir Starmer's premiership.
The rocketing bills come at a time when councils are making huge cuts to services, such as bin collection, meaning you are paying more for less.
Andrew Dixon, of campaign group Fairer Share, said: 'This data paints a stark picture of the council tax crisis looming over UK households. If maximum increases persist, bills soaring past £3,000 in 28 areas by 2030 – and £2,800-£2,900 in dozens more – expose the deep unfairness of a system stuck in 1991.
'This trajectory doesn't just burden families – it dismantles Labour's promise of households being £500 better off by 2030.'
Town halls came under scrutiny this week after separate research by the Taxpayers' Alliance found council fat cats were paid £100,000 or more in 2023-24.
A record 3,906 council employees received the six-figure salary, including staff in Northumberland, where tax bills are set to reach £3,104 by 2030.
Nottingham Council had eight officials receiving remuneration of more than £100,000, despite the unitary authority declaring effective bankruptcy in 2023.
Elliot Keck, of the TaxPayers' Alliance, said: 'These figures press home the urgent need to find a sustainable solution to council finances, given the threat of £3,000 bills hanging over many British households.
'There are serious issues around council waste and the soaring number of six figure pay packets as our town hall rich list revealed. Labour ministers need to bring forward plans to address the social care crisis while making clear to councils that budgets for other services will be restrained in coming years, with efficiency gains expected.'
A Local Government Association spokesman said: 'All councils continue to face the tough choice about whether to increase bills to bring in desperately needed funding.
'Councils need a significant change in funding in the Spending Review to stabilise local government finances.'
A Ministry for Housing, Communities and Local Government spokesman said that 'no decisions' had been taken about council tax for the future but that the referendum threshold would be maintained.
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