Durham County Council Raises Council Tax, Adjusts Business Rates for 2026-27

Durham County Council approved its 2026-27 budget in late June, raising council tax by 2.99 per cent for most properties in Bands A to D while holding Band E and above at the prior rate. The measure also increases the share of business rates the council keeps from 50 per cent to 75 per cent for the next financial year. Residents in lower-value homes will see annual bills rise by between £38 and £62 depending on band, according to the council's published tax calculator.

National changes to local government finance settlements, finalised in the March 2026 budget papers, required councils to set their own rates after central grants were reduced by 4 per cent in real terms. Durham officials used the extra business-rate flexibility to offset some of that loss. The settlement document lists the retained rates as ring-fenced for adult social care and highway maintenance only.

Effects on household costs and service access

Households in council tax Bands A and B, which make up 58 per cent of Durham properties, will pay the full increase. Single occupants who already receive the 25 per cent discount will still face a net rise of roughly £29 on Band A bills. Families in Band D homes lose the benefit of any prior freeze and will contribute an extra £52 yearly. In contrast, residents of Band F properties and above keep their existing bills unchanged.

Retained business rates are projected to generate an additional £4.2 million for the council. The money is allocated to expand the home-care contract by 120 places and to resurface 18 kilometres of rural roads in the Derwent Valley and Easington areas. Shops and small manufacturers on high streets in Durham City and Bishop Auckland will pay the same business-rate multiplier as last year, while larger out-of-town retail parks will contribute more under the new retention formula.

Local advocates note that the band adjustments reduce the previous subsidy from higher-value homes to lower ones. Policy analysts say the shift means Band A and B payers now cover a larger share of the adult social care budget than before. The legislation states that any surplus from business rates above the £4.2 million target must return to the general fund and cannot be used for discretionary grants.

Next steps for residents and the council

Council tax bills will be issued in early March 2027. Residents who qualify for council tax support can apply through the existing online portal before 31 January. The county will publish its first quarterly report on business-rate income and road-repair progress in October 2026. Further adjustments to the retention rate will require approval in the 2027-28 settlement round.