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Will Local Authorities Increase Council Tax?

04 February 2021

A significant number of local authorities are set to resist a maximum 4.99% rise in council tax from April 2021 according to research published this week by the Local Government Chronicle

The findings provide the first national snapshot of council tax plans for 2021-22 and are based on a sample of 45 councils, 32 of which are upper tier and 13 of them districts as part of the LGC’s 2021 Council Tax Tracker.

Current council tax proposal



Maximum Rise


Precept Only




Source:  LGC’s 2021 Council Tax Tracker

The news that may come as a shock to the Government who have proposed an additional £2.2bn of support for councils - £1.9bn of which is expected to be funded by an increased in the rate of council tax. 

Speaking to LGC, Basildon leader Gavin Callaghan said “This year has of course been a very tough one financially for the council… But we know how tough a year it's been for our residents, too. And so to recoup that shortfall by increasing council tax doesn't sit right with me”

The prospect of council tax rises is proving particularly contentious this year with many residents facing reduced income or unemployment as a result of the pandemic 

Why has Council Tax Policy become political?

With local elections on the horizon for counties, metropolitan districts around half of unitary authorities and a third of districts, a national political row has broken out over council tax increases ahead of the budget next month and the start of the 2021-2022 tax year. 

Local authorities in England will be able to raise council tax by 5% from April, with 3% used to top up adult social care budgets. The government argues this strikes a balance between addressing service pressures and protecting local residents from excessive increases.

However, council tax policy has become a major political battleground ahead of the March budget following calls by Labour leader Sir Keir Starmer to scrap what he deems an “absurd” rise to “give families the security they need” during the deepest recession in 300 years.

There is no doubt that council tax rises will prove unpopular but with collections for parking charges and business rates falling, there may be few other revenue sources available to local authorities to prevent cuts to essential local services.  

Could Virtual Enforcement help councils recover unpaid debt?

Local authorities are also under pressure as a result of current government restrictions which prevent enforcement agents from entering residential properties when collecting unpaid council tax.

With councils facing revenue shortfalls of £9bn this year, it remains vital that they are able to recover outstanding debt in a Covid-secure and responsible way in order to plug an estimated shortfall of £3bn 

Last month, the high court ruled that non-entry Controlled Goods Agreements are legal within the context of the 2014 Taking Control of Goods Regulations opening up the possibility that bailiffs could work remotely rather than from the doorstop when collecting debt. 

While small debts, such as PCNs or fines, are more likely to have compliance stage payment arrangements, virtual enforcement visits could become a more effective way of large debts, such council tax and business rates, where the debtor needs a longer period to pay.

Find out more about our enforcement solutions for UK Government