Funding of local government 2021 to 2022: process overview

How did we estimate how much Council Tax each council would receive?

The Scottish Government then estimated how much each council might raise from Council Tax.

Councils collect Council Tax based on an historical valuation of houses, with houses placed into one of eight bands, A to H. The number of houses in each band determines how much each council can raise.

In 2020-21, Council Tax for a Band D property in different councils varied between £1,193 and £1,409. But, to calculate how much we assume they will raise, we assume that they all charge the same amount. We also assumed that there would be an increase in the total number of houses. We did not assume any Council Tax rise in 2021-22.

Revenue raised from Council Tax in 2019-20 - £2.4 billion

A council could also increase its Council Tax rates for 2021-22, which would then give it more income to spend on services. However, for 2021-22 the government has provided £90 million of additional funding, equivalent to each council increasing its Council Tax by 3 per cent. Councils would have lost this additional funding if they had increased their Council Tax rates for 2021-22.