The 1991 Time Warp - How Scotland's Frozen Council Tax System Is Drifting Toward an Inevitable Reckoning

8th January 2026

For more than three decades, Scotland's council tax system has existed in a kind of fiscal time capsule.

Every home in the country is still taxed according to what it was worth in 1991—a different economic era, before devolution, before mass buy-to-let, before Edinburgh became a global property hotspot, and before entire regional housing markets diverged sharply in value.

The longer this system remains untouched, the more politically explosive its eventual reform becomes. And yet, despite mounting evidence of unfairness, there is still no confirmed date for a revaluation.

What exists instead is a slow-moving collision between economic reality and political caution.

A System Everyone Accepts Is Broken — But No One Wants to Fix Quickly

Successive Scottish governments have acknowledged that council tax is outdated and regressive. Independent bodies such as the Institute for Fiscal Studies have repeatedly shown that properties of wildly different values often pay similar amounts, while modest homes in lower-value areas can shoulder a heavier burden than far more expensive properties elsewhere.

The problem is not a lack of evidence or understanding. It is that revaluation creates visible winners and losers, and in a housing market that has grown unevenly, those losers are often concentrated in politically sensitive places — most notably Edinburgh and parts of the Lothians, where property values have risen far faster than the Scottish average.

Modelling suggests that in Edinburgh, a large majority of homes could move up at least one council tax band if valuations were updated to modern prices. That figure has dominated headlines, fuelling anxiety that revaluation would mean an automatic tax hike for ordinary households. But this fear, while understandable, masks a more nuanced reality.

Revaluation Does Not Automatically Mean Higher Bills — Policy Design Matters

A crucial point often lost in public debate is that revaluation and bill increases are not the same thing. Revaluation simply redistributes properties across bands based on updated values. What households actually pay depends on political choices made afterward: band rates, reliefs, and — most importantly — transitional protections.

This is why the most likely path forward is not a sudden "big bang" revaluation, but a phased system with caps on annual increases. Such protections are common in other tax systems, including business rates, and are widely seen as essential if council tax reform is to be politically survivable.

Under this model, even households that move up several bands would see changes spread over multiple years, avoiding sudden bill shocks. At the same time, homes that have been overpaying relative to their value could see reductions more quickly. This approach does not eliminate controversy, but it transforms revaluation from a cliff edge into a slope.

Why There Is Still No Date - and Why That Is Unlikely to Change Soon

Despite consultations and policy papers, the Scottish Government has not set a timetable for revaluation. This is not accidental. A full revaluation would require new legislation, extensive preparatory work by assessors, and political consensus on how the new system should operate. Ministers have openly acknowledged that comprehensive council tax reform is unlikely to be completed within a single parliamentary term, and possibly not even within this decade.

In practical terms, that means the earliest realistic implementation would be the late 2020s, and only if reform becomes a sustained political priority rather than a recurring consultation exercise. Until then, discussion will continue — but households will see no immediate change.

The Cost of Delay - Growing Distortion and a Bigger Shock Later

Ironically, the longer revaluation is postponed, the worse its eventual impact becomes. Each year that passes widens the gap between 1991 values and present-day reality. High-growth cities pull further ahead, while areas with slower price growth fall further behind — not just economically, but fiscally.

Delay does not preserve fairness; it actively erodes it. And when reform finally comes, the adjustments required will be larger, the politics harsher, and the public reaction more volatile.

An Inevitable Reckoning — But Not an Imminent One

Council tax revaluation in Scotland is best understood not as an approaching event, but as an inevitable reckoning moving at political speed rather than economic speed. There will be no overnight shock, no sudden reshuffling of bills next year or the year after. But neither can a system rooted in the early 1990s survive indefinitely in a 21st-century housing market.

When revaluation does arrive, it is overwhelmingly likely to be phased, protected, and politically cautious. Edinburgh may still see a higher proportion of homes move up bands than other areas, but that outcome will reflect decades of price divergence, not a sudden policy choice.

The real question is no longer whether revaluation will happen, but how long Scotland can continue pretending that 1991 is still an acceptable basis for taxing modern households.

When the system changes here will be winners and losers - some paying much more and some staying the same and a few less. Politically some heads may roll over the issue and hence why no decisions have been made as yet.