Council tax debt in Scotland surges to £1.8 billion

The debt includes historic non-payment dating back to 1993, with large portions concentrated in Scotland’s most populous areas. Glasgow leads with £417 million owed, followed by £310 million in Edinburgh and £101 million in North Lanarkshire.

Despite a high in-year collection rate of 95.5% for 2023–24, the scale of long-standing arrears continues to grow. Analysts warn the pressure is most acute among lower-income households, especially those receiving Universal Credit.

Figures from StepChange Debt Charity show that average council tax arrears among their Scottish clients rose to £2,075 in Q2 2024, an 11% increase from £1,871 the year before. The proportion of clients in arrears also climbed—from 31% in 2023 to 34% in mid-2024. Of those, 40% were on Universal Credit, indicating the growing burden on those with the least financial resilience.

Local authorities are increasingly turning to enforcement to recover outstanding debts. Legal actions known as “diligences” rose by 39% over the past year, highlighting how the cost of living crisis is fuelling both debt levels and the steps taken to recoup them.

One enforcement tool causing growing concern is the wage arrestment — a process where council tax debts are recovered directly from an individual’s salary, often without their prior agreement.

A spokesperson for Wage Arrestment Expert, which supports Scottish residents facing enforced debt collection, said: “We are seeing a sharp increase in the number of people reaching out for help after receiving wage arrestment orders. For many, this comes as a complete shock. Their pay is suddenly reduced without warning, leaving them unable to cover essentials.”

The spokesperson added: “Local authorities are under pressure to recover revenue, but wage arrestments can have devastating effects on individuals already living on the edge. It’s vital that people seek debt advice early, before the situation escalates.”

With inflation squeezing budgets and council tax bills absorbing a greater share of household income, more people are falling behind despite their best efforts.

Debt charities have warned that council tax is now one of the most common forms of arrears among those seeking help, and the number is only expected to rise. They say the increase in enforcement activity is a symptom of a wider affordability crisis that requires urgent policy attention.

Campaigners are calling for a more compassionate and coordinated response to the debt crisis—one that balances the need for local revenue with realistic support for those unable to pay.