County council tax bills in Shropshire could rise by 5% next year to stave off widespread service cuts.
But savings of £3.3m would still need to be made on top of the increase.
If a lower rise of 3.5% is imposed then £4.9m worth of savings would be needed across a range of services including social care and highways.
A report to Shropshire County Council's cabinet said the financial position would improve if a unitary council was created in the near future.
This would mean scrapping all Shropshire's district and borough authorities and replacing them with one all-purpose council.
A 5% rise in 2008/09 would mean a typical band D house paying an extra £48.78 for the county part of their local tax bill.
But funding for schools is safe as it has been ring-fenced by the Government, the report said.
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