The council is set to receive £51.4m across three years from the government to help pay for services like bin collections, housing and children’s services.
Council officers warned that if the authority did not increase its council tax, the forecast budget deficit would amount to £51.8m in 2030.
Grimes said the authority had identified savings to avoid hiking council tax by 4.99% – the maximum allowed without a referendum.
“We continue to face significant financial challenges, driven by increasing demand for statutory services, inflationary pressures, and changes in national funding policy,” he said.
“These are all factors which are out of our control, however, we are working hard to set a balanced budget which protects vital services without putting additional cost on to the taxpayer.
The cabinet will discuss the council’s budget at a meeting next Wednesday, according to the Local Democracy Reporting Service.
Final decisions on council tax proposals will be made in February as part of the final budget-setting process.