In a rather un-festive turn of events, five London authorities have just been given free rein by the government to raise their council tax by as much as they’d like. The decision was made following the announcement that a new formula will be used to dish out future government funding in order to give a greater share of it to the areas in England with higher deprivation.
Five London authorities (and another just outside of London) have been given the power to raise their council tax rates, as these are the areas that are expected to lose out under the shift in government funding.
The new system is set to be phased in over the next three years, starting from 2026. The six authorities in question will be allowed to raise their council tax rates by more than the usual limit of 5% over the next two years, without having to consult its residents or have the move signed off by local voters.
Which areas will be affected by the new system?
The London councils that have been granted permission to raise their council tax rates are Kensington and Chelsea, Westminster, Wandsworth, Hammersmith and Fulham, City of London, and Windsor and Maidenhead. These specific areas have been identified because of their ‘very low’ council tax rates. Households in some of these areas currently pay between £450 and £1280 less than the average council tax in England. Ministers say that the shake-up will make England’s funding model much fairer.