Council Tax
The question
To ask the Secretary of State for Housing, Communities and Local Government, with reference to paragraph 87 of the policy document entitled Local government finance policy statement 2026-27 to 2028-29, of 20 November 2025, what the maximum council tax percentage threshold is that his Department will except; and whether councils will be allowed to set a threshold above 5% over multiple years.
Answered by Alison McGovern
This week the government published the provisional Local Government Finance Settlement, which restated our commitment to review requests for additional flex. This aligns with precedent set by the previous government and is in recognition of the extremely difficult financial situation that many councils are facing.
We have not set out a maximum percentage threshold for each year, or set out limits on whether councils can request flexibility over multiple years. We encourage councils to provide this information when making requests to the Department, with detail on their financial position over multiple years.
It is for local authorities to decide the level of council tax they wish to request and set. This will reflect the service needs of each area having taken account of their other sources of income. The government is clear that in doing so, they should put taxpayers first.
Fairness for taxpayers is at the heart of this government’s decision making. We will not accept requests for additional flexibility where this would result in taxpayers paying bills above the average. For the vast majority of councils, the government intends to maintain a core referendum threshold of 3%, and a 2% adult social care precept over the multi-year Settlement.
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