Council tax could rise by nearly 10%

Bruce Sinclair, local democracy reporter

Council tax could increase by nearly 10 per cent this year, according to local authority.

At a council meeting in Ceredigion, members received a report on the 2025-26 revenue budget, which included as estimated cost pressure of £11.8m.

A report has recommended 9.7 and 9.9 per cent increases, which would mean an additional £170 to the average basic annual bill.

Government funding

A report for members revealed Ceredigion has received a 3.6 per cent funding increase.

It stated that “this unfortunately also equates to Ceredigion receiving the lowest increase per head of population across all of Wales.”

The report added: “There remain difficult budget choices to be made as part of weighing up how, if and where to reduce the cost of the council’s services, alongside considering the appropriate level of funding to be raised through council tax.”

The strategy approved in October 2024 found that “the modelled five per cent council tax increase will not be sufficient to balance the budget”.

According to the report, “this still remains the case.”

Cost pressures

The increase in second homes premiums to 150 per cent would provide an estimated £1.1m benefit, along with potential budget cuts of just under £1.1m.

But with the £11.8m cost pressures, this would still leave a shortfall of £2.5-£2.6m at a five per cent council tax increase.

In broad terms each one per cent change in council tax now equates to a net benefit of c.£536,000, a report says.

The report added: “If the current budget shortfall is funded through council tax it would equate to a further 4.7 per cent to 4.9 per cent in council tax terms and therefore be a total indicative council tax increase for 25/26 of either 9.7 per cent or 9.9 per cent.”

An increase of 9.9% would include a £346k investment in the Planning Enforcement Service and a £481k investment in the Waste Collection Service.

Members agreed to a long string of recommendations including the 9.7 and 9.9 per cent council tax increases.

The recommendations – part of a long process before the final budget is decided – will be referred to appropriate scrutiny committees, before returning to Cabinet in February ahead of a full council decision on March 3.