Councillors will vote on whether to apply for a special rate variation to increase rates by a total of 2.5 per cent, after IPART set the rate peg at just 0.8 per cent - including 0.7 per cent plus a 0.1 per cent population factor - for the coming financial year.

Frustrated by the initial rate peg, GSC mayor Jamie Chaffey said council would not be able to deliver the infrastructure and services they had planned for, without the more significant increase.

"We just won't be able to maintain the service level that we have in our community and that's not acceptable in our community," Cr Chaffey said.

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"I actually see the determination of 0.8 per cent earlier this year by IPART as being very unachievable."

Like many councils across the state, GSC has based their 10 year financial plan on an annual rate peg of 2.5 per cent, which includes funding for employee benefits, construction works, electricity, water, sewerage, automotive fuel and other business expenses.

Cr Chaffey said not increasing rates by a small increment now, would result in a substantial jump down the track to catch up on the lost funds.

"We need to make sure that we're responsible in the way we manage our funds," he said.

"Small increments of 2.5 per cent are far more achievable for our ratepayers in our community than a large hit in one particular year. It just doesn't work well for anyone."

If rates remain pegged at 0.8 percent, it is estimated that GSC will face a loss of $2.65 million in rates revenue, over a decade.

"There's always a lot of pressure on funds, there's so much to deliver on behalf of our communities," Cr Chaffey said.

Earlier this month Tamworth Regional Council also voted to make a an application to IPART for a special rate variation.

Gunnedah Shire councillors will vote on whether or not to apply for the one-off special rate variation at their meeting on Wednesday.

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