Reducing the council tax exemption for students could be explored in Southampton if new legislation is introduced by government.

Across Southampton, there are around 8,000 homes mainly occupied by students.

Households where all occupants are full-time students currently do not have to pay council tax.

The city council’s recently published transformation plan is the main approach to tackling the structural budget deficit for 2025/26 and beyond.

A 38-page document detailing the programme said work would be done to explore “the viability and impact of potential growth induced revenue opportunities”.

This included reference to a student levy “reducing council tax exemptions for students”.

Conservative group deputy leader Cllr Jeremy Moulton asked the Labour executive for more details on this subject at a council meeting on Wednesday, July 17.

Cabinet member for finance and corporate services Cllr Simon Letts said he could not expand on the subject as he was “not aware that was under consideration”.

Cllr Letts said he would ask for a written briefing to be produced for Cllr Moulton, which he would also look forward to reading.

He added that it had “long been” one of his aspirations to see such a policy introduced but the current national picture was that students do not pay council tax.

“We used to be compensated through the rate support grant for that to the sum of just over £100 per property,” Cllr Letts said.

The deputy leader of the council said this had impacted cities like Southampton, Plymouth and Nottingham where there had been a significant impact through the expansion of the university sector in the past two decades.

Cllr Letts added: “I would urge the new incoming government to have another look at the way that council tax is raised to see if we would be in a position to take advantage of any new powers that were available.”

Cabinet member for economic development Cllr Sarah Bogle said the student levy was one of the programmes in the transformation plan that was least developed and it was not included in the current savings proposals.

She added: “I do know that we have a challenge in terms of our, if you like, income as our main sources of income are council tax and business rates.

“Student accommodation is a challenge for us because we don’t get either of those, so I think from my point of view it is definitely worth exploring but I don’t know if we can actually prevent students not paying it unless we get primary legislation through government."