Future of Council Tax in Scotland Expert Roundtables

Summary: Future of Council Tax in Scotland Expert Roundtables

1. Introduction

Two in-person roundtable discussions were held with tax professionals and experts on 18 and 19 March 2026 as part of the Scottish Government and COSLA’s joint programme of engagement on the future of Council Tax in Scotland. This note summarises the views and opinions that were shared by participants at these events.

Participants included representatives from the following organisations: Association of Taxation Technicians, Chartered Institute of Taxation, Common Weal, COSLA, David Hume Institute, Enlighten, Fraser of Allander Institute, Future Economy Scotland, ICAS, Institute for Fiscal Studies, Institute of Revenues Rating and Valuation (IRRV), Joseph Rowntree Foundation, Local Government Directors of Finance Group, Low Incomes Tax Reform Group, Oxfam, Poverty and Inequality Commission, Revenue Scotland, Scottish Assessors Association, Scottish Trades Unions Congress and the University of Glasgow.

2. Reform proposals

There was broad agreement that the current Council Tax system is outdated, being based on 1991 property values and the current eight-band structure that is no longer consider fair. There was unanimous support for a property revaluation, which was seen as essential before any wider reforms could take place. Many felt that debates about the type of reform should not delay the revaluation process.

While there was consensus that Council Tax bills should better reflect property values, views differed on how this should be achieved. Some participants favoured a proportional tax linked directly to property values, while others preferred a banded approach, such as a 14-band system, as a more practical reform option. Several participants also argued that reform should go beyond revaluation to make the system more progressive and proportionate.

3. Tax on property wealth

Participants discussed Council Tax as one of the principal devolved means of taxing property wealth. Some considered that the ‘Future of Council Tax in Scotland’ consultation had not gone far enough in presenting a genuinely progressive alternative, particularly against a background of wealth becoming more concentrated at the top of the distribution. Those who expressed this view suggested that reform should contribute to a broader anti-poverty and wealth redistribution agenda.

Others stressed the need to define the primary objective of Council Tax before selecting a reform model, particularly whether it should be designed as a system primarily to: finance local services; tax property wealth; and/or redistribute wealth between households. Others made arguments highlighting the property market, and how tax can be lever which creates incentives and disincentives. Each of these objectives could produce different choices about liability, rates and reliefs. Any change should consider the incidence of the tax and who pays the charge over a longer period.

4. Communication and public engagement

There was broad agreement that any reform would need clear and consistent communication. Participants emphasised the need to explain why reform is necessary, how Council Tax contributes to funding local services, and what support mechanisms are available. Communication should also help the public understand key concepts such as revenue neutrality, how households will be protected during the transition, and how individual Council Tax bills may change over time. Participants considered effective public engagement to be critical to building understanding and support for any reforms.

5. Localism and national consistency

There was strong opposition to local authorities having their own property valuation systems. Only one participant supported this approach, while all others, including local government representatives, opposed it. Many participants felt that neither a fully national system nor complete local control was the best option. The preferred approach was a national valuation and banding system, with some flexibility for local authorities to set tax rates within agreed limits.

Several contributions suggested that the extremes of complete national uniformity and complete local discretion were unlikely to be optimal. A national valuation and banding framework, paired with controlled local rate-setting flexibility, was generally considered the more appropriate balance. This would retain meaningful local accountability without reproducing the complexity, boundary effects and financial risks of a fully localised valuation system.

6. Transition arrangements

Participants generally favoured temporary transitional arrangements and improvements to Council Tax Reduction schemes rather than widespread tax payment deferrals.

7. Owner or occupier liability

There was some discussion concerning whether Council Tax should continue to be charged to the occupier or instead become a liability of the property owner. Moving liability to owners was said to align the tax more closely with ownership of the underlying asset and could offer administrative advantages. It might also make the wealth-tax character of the system clearer.

However, other participants raised concerns with this proposal. For example, a tenant may occupy a high-value property without possessing corresponding wealth, while an owner may pass part of any Council Tax charge through rent. Participants also noted that rural households, low-income tenants and crofters could be affected differently from owner-occupiers. The treatment of students, disabled people and other groups currently protected through discounts or exemptions would also need to be reconsidered. Participants cautioned that a change in legal liability would not, by itself, determine who ultimately bore the cost.

8. Interaction with the wider tax system

Some participants favoured a proportionate property tax whether or not Land and Buildings Transaction Tax was changed, while others argued that decisions on progressivity should be taken across the tax system as a whole. The relationship with taxes on transactions, income and wealth therefore remained material, but there was concern that a wider review should not become another source of delay.

The revenue-neutral basis used for the illustrative reform work was also questioned. Some contributions argued that an under-taxed and increasingly concentrated stock of wealth justified testing revenue-positive options. Any departure from revenue neutrality would need to be explicit, as it would alter both the distributional objective and the public explanation of reform.

9. Local Government finance and redistribution

The group noted that household redistribution through the tax structure was only one part of the picture. Differences in councils’ tax bases and expenditure needs are also addressed through the General Revenue Grant. Reform would therefore need to consider the Council Tax base, local rate-setting and grant equalisation together, including the extent to which councils should be able to raise a greater share of their resources locally.