Council tax bills have skyrocketed by up to a quarter in just two years and families face even more hikes because of a looming £1billion funding gap.

The Accounts Commission reported the average bill had shot up 18 per cent since 2025, adding £250 to the cost of a Band D home.

Increases ranged from 12.3 per cent in Edinburgh to an eye-watering 25.8 per cent in Falkirk, where the levy on a Band D home jumped by £351.

Bills for Band H homes across Scotland increased by an average of £611 – and by £860 in Falkirk – exceeding £4,000 for the first time.

The Tories said the ‘damning’ report laid bare ‘systemic underfunding’ by the SNP.

The Commission warned that, despite a small real-terms increase, Scottish Government funding was not keeping pace with rising council costs, including social care and staff pay.

As a result, Scotland’s 32 local authorities face a £529million budget gap for daily running costs in 2026/27, or 3 per cent of their revenue funding. In the next two years, the revenue gap is estimated at a further £975million.

In a clear sign of more tax rises to come, the Commission urged councils to prioritise ‘long-term savings’ or ‘increasing annual income through changes to council tax’.

It said: ‘To bridge this [£975million] shortfall, they will need to raise additional income, identify further savings, or rethink how – and what – services they deliver.’

Scottish Tory local government spokesman Alexander Burnett said: ‘This damning report lays bare the impact of the SNP government’s systemic underfunding of Scotland’s councils.’

The SNP froze the levy for 11 years between 2008 and 2025, then gave councils free rein to increase it, leading to the biggest rises in two decades as bills spiked in 2025/2026 and 2026/27.

The Accounts Commission reported that although SNP revenue funding rose 2 per cent in 2026/27, capital funding plunged 15 per cent.

Commission member Derek Yule said: ‘Councils will continue to face increasing financial pressures unless they stop, reduce, or significantly redesign services.’

A Scottish Government spokesman said: 'It is up to individual local authorities to manage their day-to-day decision-making and allocate the total financial resources available to them.'