Local authorities are responsible for providing education, social care, public transport, and culture and leisure.
Funding from the Scottish government makes up the bulk of council finances.
Council tax makes up a relatively small proportion of each council’s budget but it is the area where the council has the most control.
For instance, council tax accounted for 18% of Glasgow City Council’s budget for the 2025-26 financial year.
While there was a council tax freeze for many years, revenue from the tax has still risen in real terms because of new homes being built.
Over the past decade, the general trend has also been for a real terms rise in the Scottish government grant.
But councils have argued they are now providing more services in areas such as early years provision, free school meals and adult social care – and claim the extra money has not kept pace with extra costs.
Now many councils are seeking other ways to raise revenue.
Edinburgh will be the first council in Scotland to introduce a tourist tax.
The visitor levy of 5% on overnight stays in hotels, bed and breakfasts and self-catering accommodation will take effect from 24 July 2026. About £50m is expected to be raised annually.
