Where has the cheapest council tax in England? Areas with the lowest and most expensive bills in 2023

Families in some councils in England will be paying almost three times as much in council tax this year than residents in other local authorities, analysis by NationalWorld can reveal.

The average council tax bill for a Band D property in England is set to top £2,000 next year as cash-strapped councils try to fill financial black holes with a 5% average annual increase to bills.

Some families will be harder hit than others – families in Rutland are set to have the highest annual bill in England at £2,422 for a Band D property, 2.6 times greater than those in Westminster who will pay an average of £914 next year, according to data published by the Department for Levelling Up, Housing and Communities (DLUHC).

Residents in Croydon are set to see the biggest increase to bills, with tax rising by 13.9%. It will mean families in a Band D property having to fork out an extra £274 a year. It comes as a fresh blow for households currently in the midst of the worst cost of living crisis in recent memory.

Why do council tax bills vary so dramatically across the country and which areas will have the cheapest and most expensive bills? We analysed the figures and spoke to experts to find out.

Which areas have the highest and lowest council tax in England in 2023/24?

Rutland isn’t the only council to have eyewateringly high council tax bills. Neighbouring residents in the City of Nottingham will be paying the second highest rates in England next year at £2,412 for a Band D property. Lewes in the South East and Dorset in the South West had the joint third highest rates at £2,388. Council tax rates in Scotland include water and sewerage charges, so cannot be compared, while Wales and Northern Ireland have different systems.

Some people pay tax to more than one authority, for instance those who have a county and a district council, or London residents, who fund the Greater London Authority as well as their borough council. Residents within one council area may also pay different rates depending on how much tax goes to their hyper-local parish council. The DLUHC figures show the average total council tax bill that people living in each council area will pay.

There are eight council tax bands in England – properties are allocated a band based on how much they were worth in 1991, with A being the cheapest. Band D council tax is used as the rate on which other bands are worked out, with Band A bills always 67% of Band D. This means a ranking of councils based on Band D would be the same as a ranking of councils based on any other band.

The 10 most expensive areas for council tax:

• Rutland, East Midlands, £2,422
• City of Nottingham, East Midlands, £2,412
• Lewes, South East, £2,388
• Dorset Council, South West, £2,388
• Wealden, South East, £2,363
• Newark and Sherwood, East Midlands, £2,357
• West Devon, South West, £2,347
• Bristol UA, South West, £2,345
• Gateshead, North East, £2,332
• Oxford, South East, £2,332

The six cheapest councils were all found to be in London but the region, like elsewhere in the country, has vast local variations in how much residents will be paying. Families living in Band D properties in Kingston upon Thames are set to pay £2,248 but around seven miles away in Wandsworth people will pay £921. Wandsworth and Westminster are the only councils where Band D rates will be less than £1,000.

The 10 cheapest areas for council tax:

• Westminster, London, £914
• Wandsworth, London, £921
• City of London, London, £1,146
• Hammersmith and Fulham, London, £1,306
• Kensington and Chelsea, London, £1,442
• Tower Hamlets, London, £1,581
• Windsor and Maidenhead, South East, £1,604
• Newham, London, £1,628
• Southwark, London, £1,693
• Hillingdon, London, £1,760

You can see how your council tax bill compares to households in neighbouring councils using the interactive table below.

Why do council bills vary across the country?

Councils get their funding through three main routes: government grants, council tax, and business rates. Since 2010 the government has made massive cuts to the funding it gives councils, leaving them more reliant on council tax. NationalWorld has previously revealed which councils have suffered the worst cuts.

In poorer areas there may be more people getting means-tested discounts on their council tax bills – meaning bills have to stay high for others to make up the shortfall. There may also be a greater concentration of houses falling in the cheaper council tax bands, meaning more residents paying the cheapest rates.

These areas may also have fewer businesses and lower business rates which, like council tax, are linked to the value of property. Areas such as Westminster will have a high concentration of companies in expensive properties, bringing in more income for the council.

There are likewise several factors that affect how much funding councils need to run services. Some services may be more expensive to run in rural areas, while high levels of deprivation, sickness and disability, or a particularly ageing population, will lead to higher costs for social care and children’s social services.

The DLUHC did not respond to NationalWorld’s question about the variation in council tax  across the country but did say there is a referendum threshold “to protect residents from excessive increases”, meaning residents can have the final say if councils want to raise taxes by 5% or more.

A DLUHC spokesperson said: “We’ve given town halls the biggest cash increase in their spending power in 10 years, with an extra £3.7 billion this year to help them maintain and improve their services and more than £1 billion of additional money for social care. We are also providing £100 million of additional funding for local authorities to deliver additional support to most vulnerable households in England.”

Marcus Johns, research fellow at think tank IPPR North, said that the wider national system is to blame, adding: “While local authorities do set rates in setting their annual budgets—they are highly constrained in doing so by the way council tax is designed nationally.”

He said comparing councils based on Band D rates may not be a true reflection of what the average resident pays – in councils that have expensive Band D rates but also a greater number of lower tax properties, more people will be paying the cheaper rates, whereas  in areas with a higher concentration of expensive properties in Bands E to H more people will be paying the more expensive rates.

What needs to be changed?

The council tax system isn’t immune to criticism and campaigners have called for reform to make it fairer for bill payers and local councils who are in most need. Johns added that people are ‘’paying more council tax for less” .

“Since 2010, local authorities are increasingly reliant on council tax to raise revenues because of national cuts to local government funding, which has reduced local government capacity, decimated service provision, and undermined resilience,” he said. “Particularly places with high levels of need, and lower council tax bases, have often faced the highest cuts.

“A new approach is needed, rooted in a fair approach to funding local government that recognises local needs and well-designed fiscal devolution. This would better help places make long-term plans and properly fund the local services that people expect.”

Elliot Keck, investigations campaign manager for the TaxPayers’ Alliance, added that the figures reveal the “cost of the local government crisis” in England.

"While some councils have shown best practice by improving efficiencies and cutting costs, others are charging residents for their failure to trim the fat.”