Future of council tax in Scotland: Consultation analysis Final Report

4. Qualitative analysis

Introduction

Chapter 4 presents the analysis of the two final open questions. Question 15 asked for views on the impact of council tax reform on particular population groups, businesses and/or places. Question 16 asked for any final comments or views on the consultation themes or council tax reform.

Impact assessment

Question 15: Do you have any information you wish to share that has not already been discussed in the paper on the impact of council tax reform on any of the following: Groups who share protected characteristics; Island communities; Businesses or organisations in the public, private or third sector; and Your local area?

There were 434 responses to question 15, of which 171 were identified as relevant to the question. This section presents the analysis of responses for each group in Question 15. The impacts detailed by respondents are presented under each group, in order of the number of comments made about each. Other responses that did not directly answer the question have been considered in the final qualitative section below.

Impact on groups who share protected characteristics

Several respondents raised issues about the impact of council tax reform on groups that share protected characteristics.

Age

Some respondents were concerned that council tax reform could negatively impact older people and pensioners. These respondents put forward the view that older people often live alone in large family homes that could move into a higher council tax band as a result of reform, and lead to an increase in council tax for these households. Some respondents also noted that many pensioners have a fixed income and may be less able to manage increases in council tax, particularly if the state pension is their sole or main source of income.

A few respondents also raised a concern that some older people could be forced to move out of homes that are suitable for their needs in later life if council tax was to increase for them.

“Concerned about pensioners who have moved into homes where they can age in place…These properties are often more expensive and owners have used savings for purchase, with only pensions to meet monthly expenses - including council tax.” (Individual, Aberdeenshire, Band E).

Some respondents also highlighted a potential negative impact of council tax reform on younger people. These respondents expressed a view that young people are more likely to be on lower incomes and be renting properties and could experience an increase in council tax that exceeds their ability to pay. A few respondents suggested introducing a council tax discount for younger people or for first time homebuyers.

Disability

Some respondents raised concerns that those with a disability could be placed under financial pressure if they are subject to an increase in council tax as a result of reform. These respondents also noted that some disabled people may experience difficulties in securing and sustaining employment, which can result in them having lower or less consistent incomes. Some also mentioned that disabled people sometimes need larger homes to meet their needs and may therefore be subject to higher council tax under a reformed system.

“Disabled people often face additional living costs related to energy use, transport and home/tech adaptations, meaning that changes to council tax may compound existing financial pressures.” (Scottish Community Development Centre)

Sex

A few respondents also suggested that council tax reform could have an impact on women, highlighting in their responses that women are more likely to have a smaller income, hold less wealth and to have unpaid caring responsibilities (including being a single mother). As a result, these respondents felt that some women could be at risk of financial hardship if council tax reform resulted in higher bills.

Other

A few respondents considered the possible impacts of council tax reform on other groups with protected characteristics including gender reassignment, pregnancy/maternity, race, religion, sexual orientation. Concerns were raised about the risk of financial hardship or disadvantage for people in these groups, should council tax bills increase as a result of council tax reform.

Finally, some respondents did not believe that protected characteristics should be considered at all as part of council tax reform as this was not considered relevant to an individual’s ability to pay council tax.

Impact on your local area

Several respondents raised points about the possible impact of council tax reform on their local area.

Some respondents also highlighted issues with the council tax bands in their local area, expressing a hope that reform would allow for bands to reflect property values in their local area more accurately. This included respondents who reported that, in their view, their property was in too high a band, and that more expensive houses in their area should be in a higher band. A few respondents also noted differences in council tax rates between local areas.

Some respondents reported concerns that rural areas could be impacted negatively by council tax reform on the basis that their local housing markets can be distorted by affordability issues, seasonal demand and second home ownership, inflating property values. These respondents felt that households in rural areas could therefore be subject to a council tax increase following council tax reform that is disproportionate to their ability to pay.

“A problem which people in remote rural communities have, particularly in 'scenic' areas, is that house prices are hugely inflated with respect to earnings in the local economy.” (Individual, Dumfries and Galloway, Does not pay council tax)

Some respondents stated that there is a gap between house prices and earnings in their local area, and raised concerns that reform may not properly capture ability to pay council tax. Some respondents expressed a view that in areas where property prices have increased, lower income earners could be forced to move if council tax increased.

Finally, some respondents commented that services in their local area were poor and did not offer value for money relative to the cost of council tax. These respondents were concerned that council tax reform could result in higher tax bills without corresponding improvements in services.

Impact on island communities

Regarding the potential impacts of council tax reform on island communities, some respondents felt that island communities pay disproportionately more for the services they receive. Respondents highlighted that compared to the mainland, the islands often lack services or have more difficulties in accessing them, and this should be reflected in council tax rates.

Some respondents also noted that living costs, such as food and heating, tend to be higher in island communities and other rural areas. There was concern that council tax reform would place an extra financial burden on these households and exacerbate the perceived inequality of the rural premium.

“The cost of living in Island Communities is disproportionate to the rest of Scotland. Any changes to the council tax system should ensure island proofing to nuance the effects to Islanders.” (Comhairle nan Eilean Siar)

A few respondents highlighted the impact of increasing property prices on Scottish islands as a result of demand for holiday homes and a lack of available housing. There was concern that council tax reform could mean island properties would move into higher council tax bands, leading to increased bills.

A few respondents suggested considering islands separately from the mainland as part of any council tax reform and a few respondents identified a need for a separate Islands Impact Assessment to be carried out on any proposed council tax reforms.

Impact on businesses or organisations in the public, private or third sector

Finally, some respondents raised concerns about the potential impact of council tax reform on businesses or organisations in the public, private or third sector.

Some respondents highlighted the potential impact of council tax reform on local authorities, with a few respondents expressing concern about the potential erosion of revenue should more people become eligible for relief and reduction schemes. A few respondents also raised concerns that reform could lead to a reduction in council tax collection levels, and place additional demand on council services to support households.

“It is anticipated that if proposed Council Tax changes are implemented significantly above inflation rates, collection levels of Council Tax are likely to reduce, and additional demand will be placed on already stretched council and external support services.” (East Renfrewshire Council)

A few respondents also noted the potential impact on third-sector organisations. These respondents were concerned that council tax increases could put more pressure on third-sector organisations and charities supporting vulnerable people. A few respondents also raised concerns that council tax reform during a housing crisis could impact the demand and supply of new build homes.

“More than one-in-eight people who went to CAB in 2025 were advised on a Council Tax issue. The CAB Service will likely experience a demand in advice on Council Tax at a time when the Service is stretched in terms of resource and funding.” (Citizens Advice Scotland)

Final comments

Question 16: Please provide any other comments or views on the consultation themes or council tax reform that you have not been able to share above.

There were 586 responses to question 16. Comments made by respondents in ‘other, please specify boxes’ for questions 3, 5, 9, 11 and 14, and in the open text response to question 15, which were not directly relevant to those questions, have also been considered here.

Objections to a property-based council tax model

The most common theme raised by respondents was that property values should not be used at all, and/or should not be the only measure used to determine council tax bands and payments.

Many respondents were of the view that property value is a poor proxy for household income and ability to pay.

“Property values do not correlate with ability to pay. Residents can be asset rich but cash poor, particularly pensioners on fixed incomes. Larger properties are often older with poor energy ratings. All should declare income not just those wanting support”. (Individual, South Ayrshire, Band H).

Many respondents also suggested household occupancy and use of local services as a more appropriate approach to setting council tax thresholds.

“Everyone uses the same council services! Why should someone in a dearer house pay more? What extra service are they getting? It doesn’t make sense?”. (Individual, Midlothian, Band not supplied).

“It should be based on what services you get. It is unfair to charge more for services than you use just because your home may be valued different from a neighbour.” (Individual, East Renfrewshire, Band G).

Many respondents also highlighted other factors and issues with using only property-values to determine council tax bands and payments. These included:

• The individual circumstances of households and their occupants and, in particular, their ability to pay. One example provided by respondents included low- and middle-income households who could pay a higher proportion of their income than higher earners living in similar banded properties. Other examples included retired people that have limited savings and rely on their pensions, and disabled people that require a larger or higher value house due to adaptations.

“Council tax should not be based on property; it should be based on individuals. It is currently grossly unfair, a retired couple in their seventies can be paying considerably more than a house with 4 working adults.” (Individual, West Dunbartonshire, Band E).

• Differences in the valuation of properties across local authorities, despite similar sized properties.

“A fairer system not based on where you live but rather the size of your property. So, for example, a 3-bed semi-detached is pretty much the same Council Tax across Scotland.” (Individual, East Renfrewshire, Band E).

• A risk that some could be ‘unfairly penalised’ as a result of revaluation of property values moving them into higher council tax bands. Examples provided included those that have invested in their house (upgrading or extending), people that wish to live in a higher valued property (often linked to higher quality and larger size of property), and those that wish to live in a particular area due to school catchments.

“Over the years we have extended our house, spending our money, which we have paid tax on, increasing the value of our home, and now these proposals are going to penalise us for this.” (Individual, East Dunbartonshire, Band F).

Alternative or more substantial reform

The second most common theme raised by respondents was that more substantial or alternative reform of the council tax system was required. Many respondents expressed a view that the reform measures proposed in the consultation do not go far enough. The most frequently mentioned alternative, raised by several respondents, was a per-capita tax (or “poll tax”) whereby a flat-rate tax is levied equally on every adult resident, regardless of income or wealth.

“Poll tax is a much fairer way. You may have a larger property but that does not equate to having more income.” (Individual, Dumfries and Galloway, Band E).

Several respondents also mentioned that a local income tax should be considered based on household income.

“Council tax must be replaced by a "Local Income Tax" which is fairer and progressive. After all, it is how we pay for "National" Government services”. (Individual, Aberdeenshire, Band E).

“Following the Scandinavian model, a shift toward a Local Income Tax could ensure that contributions are more closely aligned with an individual's ability to pay, replacing the broken business rates and council tax systems entirely.” (Individual, City of Edinburgh, Band E).

Some respondents suggested other potential approaches to council tax reform, including:

• Land value tax – based on the value of the land, not the property.

“The Council Tax (CT) is fundamentally flawed and ought to be replaced with Land Value Taxation (LVT). CT is levied on built property, whereas LVT would be levied on land values alone. Whereas buildings are the product of private or corporate effort and investment, land values are publicly generated as a measure of overall public demand for location and enhanced by the provision of publicly funded services and infrastructure. They are the obvious source of public revenue and should be recycled into the public purse.” (Individual, Stirling, Band G).

• Proportional property tax - an annual levy based on current capital property value. This approach was favoured by organisations and a few respondents questioned why it was not considered as a reform option, particularly as it was included in the independent analysis carried out by the Institute for Fiscal Studies.

“The Commission noted that the Continuous Proportional system was modelled in the IFS report for the Scottish Government but not included as an option in the consultation paper. In the analysis, this was estimated to be the most progressive of the options. There is support for the principles of this option from both the Commission and the Experts by Experience Panel. In line with previous Commission recommendations, this option may form a basis for long-term reform of local taxation. The system of domestic rates in Northern Ireland, which uses a system of continuous proportionality up to a maximum cap, could be further examined to assess the feasibility of a similar approach.” (The Poverty and Inequality Commission)

• Services-based tax based on the level of services used/accessed.

“Council Tax should be the cost of the regional council / the number of residents. This should be raised by charging households for resident x services required x value of property.” (Individual, Fife, Band E).

“Council Tax should not be based on property value. Home value has no impact on council services used, like the generation of waste, for example. Having a pay as you go for certain Council services and a flat rate for core council services based on occupancy would be much fairer.” (Individual, East Lothian, Band G).

A few respondents also suggested that a wealth tax would be a more appropriate alternative to council tax.

Impact of the council tax reform proposals on individuals and households

Another prevalent theme, raised by many respondents, was concern about the affordability of the council tax reform proposals in terms of revaluation moving households into higher (and more expensive) bands.

Several respondents commented that many households that are likely to be affected by revaluation already pay a high level of income tax and will face a greater tax burden.

“Revaluation should not be used just to raise additional taxes and place unsustainable rises on people who have already paid more in taxes than most people”. (Individual, West Lothian, Band G).

Several respondents raised concerns that an increase in council tax will not equate to an increase or improvement in service delivery with a risk of paying more tax for the same or a reduced level of service.

“Services are becoming less and the people are being asked to pay more for a very inadequate and basic service from their relative councils. The public are not getting value for money.” (Individual, West Lothian, Band not supplied).

More broadly, several respondents noted that, given the ongoing cost of living pressures, further increases in Council Tax could have significant negative impacts, including reducing disposable income or pushing some households into poverty.

“10% annual increases are high. Potential for 40% increase over 4 years would be devastating to many households.” (Individual, Aberdeen City, Band G).

“People are struggling as it is, these increases are huge year on year. We are a household with 2 adults in a band F property our salary only increased 1% last year and including cost of living crisis we can’t afford to pay anymore council tax”. (Individual, Dumfries and Galloway, Band F).

Within these responses, some specific examples were provided in relation to rural areas where respondents felt that there is already a perceived disparity in the level and/or quality for services such as lighting, public infrastructure and refuse collection.

“People who live remote, I live in rural Aberdeenshire, and get nothing for my council tax, effectively bins. There's no public infrastructure in the village, no play park for kids, not paths in most of the village”. (Individual, Aberdeenshire, Band not supplied).

Support for Council Tax reform

Support for council tax reform was also a prevalent theme. Several respondents noted that the current system, based on older property valuations, creates disparities between similar properties in both banding and council tax costs.

“For me, the key considerations are maintaining fairness across different areas of Scotland in term of banding to avoid properties of similar value having radically different council tax bills when they may just sit a few miles apart…..and regular revaluations so that changes in values are accurately reflected in banding and new properties get a fair banding allocated as compared to older properties”. (Individual, West Lothian, Band F).

Some respondents were concerned that newer builds are often placed in higher bands without being assessed on a like-for-like basis with older properties.

“This is well overdue - as the owner of a reasonably high value new build property in Edinburgh I know I am paying significantly more in council tax than people in £million properties whose value has gone up significantly since the bands were set, based on popularisation / gentrification of previously low-cost housing areas.” (Individual, City of Edinburgh, Band G).

Some respondents also provided further explanation as to why they felt that revaluation (and more regular revaluation) is needed. Specific points raised included:

• The system for appraising value needs to keeps pace with housing market trends.
• Regular revaluation should include properties that have been extended and/or invested in (increasing their value).
• Revaluation should occur when a property is sold to ensure it is up to date.

Some respondents felt that regular revaluation could help to tackle inequality within the current council tax system, including:

• Horizontal inequity: where households in similar valued properties pay different levels of council tax.

“The banding between areas also seems grossly unfair. Our house is the same price as it was in another council area yet both being new build homes they are 1 band apart. We just fall into tax band F and with the 10% increase it’s stretched our budget extremely tight”. (Individual, East Lothian, Band F).

• Regressivity: where lower-value properties and lower-income households pay a higher effective rate relative to their wealth/income.

“Modernisation is essential to ensure the system is fair, up-to-date, and more progressive, with contributions more closely aligned to households’ ability to pay”. (North Lanarkshire Council).

Some respondents were supportive of council tax reform but did not support all aspects of the proposed reforms. This was mainly due to concerns about the financial impact on households, particularly the potential for increased costs following revaluation. Within this, a few respondents expressed strong opposition to the proposals for deferrals to be payable on death and viewed this as an additional inheritance tax.

Upfront and ongoing costs to implement the proposed reform measures

Many respondents raised concerns about the potential costs of implementing the reform measures. Several respondents identified a need for ongoing revaluation to be proportionate in terms of both cost and administrative capacity.

“Whilst it is important that the Council Tax base reflects current market values, we must also take into account the capacity that the Valuation Joint Boards have to increase the frequency of valuations in addition to their existing workload.” (SNP Group, East Dunbartonshire Council)

Several respondents also raised concerns about the potential impact of the proposed transitional relief scheme, including that it could reduce Council Tax receipts.

“Transitional arrangements are important to ensure changes to the tax system are fair, however, they should be time limited to ensure that the wealthiest households cannot unduly avoid their liabilities.” (Scottish Women's Budget Group).

Ensuring protections for vulnerable individuals and households

Ensuring that reform of the council tax system included protection for vulnerable individuals and households was also a prevalent theme raised by many respondents.

Several respondents identified low-income households as needing additional protection, arguing that these households pay a disproportionate share of council tax relative to their income, and even small increases could push some households (further) into poverty.

“One in ten of the lowest income households are behind on their Council Tax bills. We already know that nearly half of unpaid carers are cutting back on essentials, with many falling into debt to make ends meet - Council tax debt is part of the picture”. (National Carer Organisations)

Some respondents also suggested that the following groups should be considered as vulnerable and therefore eligible for additional safeguards or protections:

• Pensioners/older people, particularly those with low/no savings or other forms of income.

“For the reform to fulfil its aims of making the system fair it is fundamental that low-income pensioner households are supported through mitigation within both the current and proposed systems. The impact on pensioners on low incomes is significant. Recent polling for Independent Age found 27% of those over 65 in Scotland have struggled with their CT bill ‘constantly’ (7%) or ‘from time to time’ (20%). This rises to 34% for those for those with household incomes under £15,000, with 3% having fallen into debt”. (Independent Age)

• Private renters, for example, where council tax costs are not borne by/shared with the landlord/owner.“I feel it is unfair for renters, especially private residential tenants who may be staying in properties worth a lot of money, whether renting from a private landlord or through a local authority or social landlord mid-market rent tenancy and having to pay a higher amount of council tax when they do not own the property.” (Individual respondent, Glasgow City, Band C)
• Disabled people who may be on lower incomes and/or in receipt of benefits.

“Also, I think if there were better reductions for pensioners and the disabled this also would be a much fairer system. There are a lot of disabled people who don't qualify for a reduction in council tax just because their light switches haven't been lower. Not every disabled person is in a wheelchair. This definitely needs to be reviewed. You can be classed as disabled for multiple different types of disability.” (Individual respondent, Dumfries and Galloway, Band D)

In addition, a few respondents observed that other groups face specific challenges and should be considered for additional safeguards or protections, including island and/or rural communities, and (unpaid) carers. Conversely, a few respondents suggested that landlords should not be eligible for any protections or safeguards.

Wider points and consultation feedback

Issues with the consultation process itself was a recurring theme raised by several respondents. Some respondents felt that the proposed reform options were too narrow in scope and represented lighter-touch changes, rather than more fundamental reform.

“It seems shortsighted that we're looking to "reform" council tax rather than looking at a truly more progressive tax”. (Individual, Glasgow City, Band E).

Some respondents also commented on the design of the questions, noting that they found parts of the consultation hard to follow with some questions too long or overly complex. Others felt that response options were too limited, often forcing a binary choice that did not reflect the nuances of their views.

There was also a perception amongst some respondents that the views of respondents would not be taken on board to refine the proposals and that the consultation was not well advertised or promoted, which was considered inadequate given the importance of the topic.

Some respondents felt that a citizen or people’s assembly should be formed to debate the future of council tax in more detail.

Several respondents expressed a general lack of trust in local and national government. This was often linked to concerns about how council tax revenue is spent, with respondents highlighting perceived inefficiencies in service delivery and broader issues around accountability. There was also a view amongst some respondents that proposed council tax reforms were simply a way to extract more money from taxpayers, with a few respondents also referencing past pledges to abolish council tax altogether.

Out of consultation scope

Many respondents provided feedback that, while relevant to the wider discussion on council tax reform, was nonetheless outside the scope of the consultation.

Several respondents raised issues with how council tax revenues are spent. Some respondents suggested that the public should have greater input on spending decisions and expressed a view that revenue is not currently being invested in the right services.

“Transparency is badly needed where council tax is concerned as every year the council tax burden increases but services are noticeably worsening.” (Individual, City of Edinburgh, Band not supplied).

“Councils need to be run like a business and maybe then they'll have a better handle on their expenditure. I read that my local authority spends the equivalent of 40% of their entire income from council tax, on employees’ pension contributions.” (Individual, Fife, Band F).

Some respondents (mostly organisations) noted that council tax reform could have implications for local council funding and suggested that the system should retain a degree of flexibility to set or inform rates locally.

Within this final section some respondents raised issues or made suggestions about the council tax property revaluation process that were not captured within the consultation questions. These included issues such as whether people that had invested in property improvements to reduce environmental impacts should receive a reduction in their council tax bills or how revaluation should respond to property improvements and extensions where they added value to people’s homes. A few of these respondents identified a risk that council tax reform could act as a disincentive to such property improvement.

Some respondents also felt that the proposals could have an adverse impact on the housing market. An example provided by respondents was if reforms lead to higher tax bills this could reduce overall demand and/or increase demand for lower value properties which could then reduce the availability of properties for first time buyers and the rental market.

Some respondents also commented on wider issues relating to:

• Treatment of second homes and self-catering.
• Water and sewerage charges.
• Council Tax debt.

A few respondents also took the opportunity to criticise council tax in a general sense, noting that they felt tax in Scotland was already high. A few noted that a more progressive tax system risked penalising higher earners.

A few respondents expressed dissatisfaction with the current process for appealing decisions about council tax bands or reductions and felt that his should be addressed as part of future reform measures.

A few respondents also called for clear communication about council tax reform and for the publication of online calculators for households to understand the potential impact of reform on their own circumstances.

The question of whether council tax should be collected at national or local (council) level was also raised with a few respondents making arguments for each approach on the basis that either a national or a local approach would be more equitable.

Finally, a few respondents provided feedback that was both outwith scope of the consultation and not related to wider comments made by other respondents. This included commentary on:

• The income tax system in Scotland and the need to reform all taxation.
• Housing being a basic human right.
• Comparison with the proposed council tax reforms in England.
• Previous research undertaken by a respondent on the implications of council tax reform.