The Social Market Foundation said the move would cut average council taxes by around £356 per household.
Barney Dowling, researcher at Social Market Foundation, said: ‘Councils budgets should be responsible for resident services and local amenities, while the social care burden should be shared across the country more fairly and risk can be pooled more widely. Our research shows how to maximise the political feasibility of reform, by minimising the share of households that may have to pay substantially more.'
Over a fifth of council tax receipts (£9.2bn) were spent on adult social care for the over 65s in 2024/25.
The report shows taking social care costs out of council budgets will benefit less affluent areas mostly as local authorities will lower home values and, therefore weaker council tax revenues, spend more on social care as a proportion of tax income.
South West households would save over £400 compared with less than £200 in affluent parts of London.
The report also looks at how removing social care from council tax bills would impact on different proposals to reform council tax. For example, creating a single continuous tax based on current property values (as proposed by the Resolution Foundation) results in an estimated 38% of properties losing out under the current system, but just 23% after social care is removed.
The Social Market Foundation says alongside changes to council tax, a new national funding settlement for social care would allow the cost to be shared across the country more fairly with risk pooled more widely.
A Local Government Association spokesperson said: ‘The funding model for adult social care has fully outgrown itself and needs reform. We believe the Government should make the case to the public for a comprehensive funding solution for adult social care, ensuring any National Care Service strengthens appropriate consistency, not replacing local democratic leadership.
‘Successful reform of adult social care will require a new partnership between national government, local government and the public. It will ultimately be judged by whether people who draw on care and support are better able to remain connected to the people, places and passions that matter most in their lives.'
