Nearly nine million households in England are set to be hit with an additional £1 billion hidden council tax bill, driven by rising parish and town council precepts. These local taxes, charged on top of standard council tax, fund parish operations and services. Estimates show that parish councils will raise £942 million through precepts in 2026-27, up from £859 million the previous year. For areas with a precept, bills will increase by an average of 8.2%.
Uncapped Increases Spark Concern
Unlike county and district authorities, parish and town councils can raise tax rates by more than 4.99% without holding a referendum or obtaining special government permission. This rule allows them to impose significant annual increases. David Simmonds, the Conservative Party shadow communities minister, stated that council tax is “soaring on Labour’s watch.” He added: “Labour’s refusal to apply the protections of local referendums to the largest parish precepts has opened the door to huge hikes.”
Postcode Lottery of Tax Rates
Andrew Dixon, from the campaign group Fairer Share, warned that residents face a postcode lottery of tax rates. He explained: “The rapid growth in parish council tax reflects wider strains across local government finance. As funding pressures intensify across the system, more costs are being pushed on to increasingly localised tax bases. The result is a patchwork system where households face very different tax bills depending on local governance structures rather than ability to pay.”
Benjamin Elks, of the TaxPayers’ Alliance, expressed outrage: “Local taxpayers will be absolutely furious with the scale of tax rises from parish councils. While town and parish councils have an important role to play in communities, it cannot be right for them to impose uncapped, inflation-busting tax increases, particularly when families are already dealing with a cost of living crisis.”
Government Response
A Ministry of Housing, Communities and Local Government spokesperson said: “We have maintained the previous government’s policy of not setting tax limits for parish and town councils and we will continue to review this position each year. We are clear that councils should protect taxpayers from large rises and ensure any increase is justified.”
