Lancaster City Council has voted through a 2.99 per cent increase in its share of Council tax.
Councillors met at Morecambe Town Hall last Wednesday and voted through the tax rise by a majority.
Voting in favour of the tax rise were councillors Ainscough, Armistead, Bannon, Belcher, Matthew Black, Phillip Black, Blaikie, Bottoms, Brookes, Cleet, Colbridge, Colley, Cozler, Deery, Dennison, Dowding, Fish, Gawith, Greenwell, Hamilton-Cox, Hanson, Hart, Hartley, Hunter, Caroline Jackson, Livermore, Maddocks, McGowan, Abi Mills, Hamish Mills, Otway, Pattison, Penney, Potter, Pritchard, Punshon, Redfern, Riches, Sommerville, Stubbins, Stubbs, Thornberry, Tyldesley, Whitaker, Wilkinson and Wood.
Councillors Abuhajar, Bradley and Harris voted against.
Councillors Budden, Newton and Wild abstained.
Councillor Phillip Black of Labour, spoke out before the vote, saying the council was being "forced" into raising Council tax.
"Whilst there is a degree to which there is an element of robbing Peter to pay Paul, there are things to be welcomed from the government's Fair Funding Review," said Councillor Black.
"Nationally, more money is going to areas with greater deprivation, and for the first time in several years the government has provided a multi-year (financial) settlement to local government, offering clarity and stability to facilitate long-term planning.
"Lancaster District will receive a very welcome additional £850,000 to our budgets, easing some of the pressure on our structural deficit.
"However I must say I find it particularly exasperating that this review claims what successive governments have claimed, that councils are seeing an increase in their Core Spending Power. This is only true if councils vote to put up Council tax and increase the taxation burden on our residents.
"And of course we all will, because the revenue grants from central government have been withdrawn. We aren't getting the money from Government but we have services to provide.
"This is a stealth taxation whereby the tax burden is being shifted from central government to local authorities.
"The Treasury then can avoid some of the need to put up taxes, any disgruntled citizen unhappy with the rising tax burden aims their ire at their local council and not the government of the day.
"I think governments of all stripes need to be straightforward and transparent with people. If frontline services are to be funded by local taxation rather than central taxation, then that's what we should tell people.
"Governments shouldn't try to claim that councils are getting a three per cent uplift in Spending Power when what they mean is councils will be forced into charging three per cent extra on the Council tax bill.
"We all know Council tax is a regressive form of taxation."
District councils are allowed, by law, to raise their proportion of Council tax by 3 per cent or £5, whichever is higher, without a public referendum.
The 2.99 per cent increase will push up a Band D property owners' annual payment to Lancaster City Council, to £272.20 from £264.30.
The council said it is facing forecasted budget deficits over the next five years.
Prior to Wednesday's meeting, a council report said the 2026/7 budget still had not been balanced.
But Green Councillor Tim Hamilton-Cox (below), cabinet member for finance, said at the meeting: "We more or less have a balanced budget (now), subject to no other changes.
"Things have moved in the right direction.
"In February 2025, the 2026/27 funding gap was over £2.6m but that has now been addressed.
"The budget gap for 27/28 was £4.7m and that, currently, has been more than halved.
"Although we still have a deficit in prospect for 27/28 it has already come down significantly."
A final budget proposal will be presented at the council Cabinet meeting on February 10 and recommended to the full council on February 25.
Lancashire residents pay the vast majority of their Council tax bill to Lancashire County Council, which is proposing a 3.8 per cent rise in its share.
Residents of the Lancaster and Morecambe District pay the rest of their Council tax bill to Lancaster City Council, the police - which will raise its share by 5.4 per cent - and fire authorities, and their local parish council depending on where they live (ie Morecambe Town Council, Carnforth Town Council etc).
Read more: Lancashire County Council's share of Council tax proposed to rise by 3.8 per cent - Beyond Radio
Morecambe Town Council agrees budget and 2.46 per cent rise in Council tax share - Beyond Radio
Carnforth residents set to pay less Council tax to town council - Beyond Radio
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