Labour's 'fair funding' cuts could force London council to impose Britain's biggest ever council tax rise of 150%

From the Newshound archive · first published 3 October 2026 · last updated 4 October 2026.

Hammersmith and Fulham council has warned that a 150% council tax increase — equivalent to £29.11 extra per week on Band D bills — may be unavoidable after Labour's "fair funding" review cut its government grant by more than half. The borough's allocation is projected to drop from £150.5m to £72.4m across four years, opening a budget gap too large for modest increases to address. Even a 100% rise would leave a £46.1m shortfall, with only the full 150% increase bringing the books into balance.

Hammersmith and Fulham currently holds the THIRD LOWEST council tax rate in England, making the scale of the proposed increase particularly striking.

Under the same Labour funding squeeze, neighbouring Westminster and Wandsworth face potential rises of 200% and 188% respectively.

Meanwhile, London Labour MPs are urging Chancellor John Healey to drop plans to lower the mansion tax threshold to £1.5m, cautioning that the move would affect nearly 62,000 additional capital homeowners.