The average home's council tax bill will increase by £359 by 2029, the Spending Review revealed.
Ministers are working on the basis that councils will increase the rate by 5 per cent a year for the next three years.
The rise will fund the settlement for local authorities, which includes social care – an issue on which Labour is yet to outline its policy.
It also assumes that the police precept – the portion of council tax that goes directly to forces – will have to rise.
Asked about the increase, Chancellor Rachel Reeves said: 'The previous government increased council tax by 5 per cent a year, and we have stuck to that.
