Residents in Birmingham face a 10 per cent rise in council tax as part of plans to save £300million over two years.
For the average band D household, the jump could be the equivalent of an extra £190.57.
It comes after the city council declared themselves bankrupt in September as it faces the challenge of a £760million equal pay bill and an £80million overspend on an IT project.
The council is now set to apply for government permission to raise the tax by more than the five per cent "referendum limit" - the maximum amount they can raise without consulting residents.
Residents in Birmingham face a 10 per cent rise in council tax as part of plans to save £300million over two years
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Interim Director of Finance at the council, Fiona Greenway, made the recommendation in the report after revealing £150million worth of savings for the next year had been found so far, with £72.8million coming from "Service Reduction".
In a report last month, the council revealed it has a forecasted budget gap of £164.8million in 2024/25, rising to £177.1million in 2025/26.
Presented to the Birmingham City Council Cabinet meeting last week, the report recommends “the Leader of the Council and the Chief Executive, together with the Section 151 Officer, submit a formal written request to the Department for Levelling Up, Housing and Communities for extraordinary financial support to allow the Council to deliver a balanced budget for the 2024/25 financial year”.
"Most [councils issuing 114 notices] were allowed to increase council tax by around 10 per cent," Max Caller, expert and lead of the government-appointed commissioners at the council told the BBC.
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Reacting to the latest financial position, Leader of the Opposition at Birmingham City Council, Conservative Councillor Robert Alden, called the Labour administration at the council "disgraceful".
He said: "This is a truly tragic day for Birmingham residents. This finance report lays clear the impact of 11 years of Labour rule on our great city.
"It confirms Birmingham Labour are planning to set an unlawful deficit budget and it confirms that the Labour Cabinet plan to increase Council tax far beyond the current referendum limit of five per cent, on top of the fact they have already increase it by around 46 per cent since they took control in 2012.
“It is now clear no service from the Council, no asset or community facility and no Council Tax bill is safe from this predatory Labour administration who have spent a year fiddling their fingers while they watched Birmingham City Council burn.
Birmingham City CentrePA“Brummies can't afford another minute of this disgraceful administration".
Leader of Birmingham City Council, Councillor John Cotton, says his cabinet remains "focussed" on the work to be done.
He said: "I've been clear that the council must change. We face some painful financial decisions in the coming months, and we must be absolutely transparent about the situation the council is in.
"Work is already underway to transform the council, but it is clear that we must work harder than ever before to bring about the changes that we need to see, to build a better council for our workforce and the 1.2 million citizens of Birmingham.
"We need to reset our finances, reset how we deliver our services, and reset the relationship with our residents, partners and staff. There can be no let-up in this work and the cabinet and leadership team will remain focussed on working with commissioners to get the council on a road to improvement."
