Wandsworth’s era as a low-tax council could be over after reports showed a £54m funding black hole would require a 75 per cent rate hike to plug.

The surge in residents’ council tax bill would need to come in next year to help fill the gap before 2017-18.

An audit report by PWC into finances at Wandsworth Council indicates a shortfall of more than £32m in 2016-17, and a cumulative gap of £54m by 2017-18.

To compensate, Band D council tax would need jump from £683.42 to £1,145.88, including the Greater London Assembly contribution by 2017-18, an increase of 67 per cent on the current rate in two years.

Council leader Ravi Govindia said that its budget would be examined later this month and that, without wishing to pre-empt its decision would continue to cut spending and develop "more efficient ways of delivering" services.

The Wandsworth Council element of Band D allowance would need to go up by 75 per cent in the next financial year, and a further 27 per cent the year after, as the GLA is reducing the amount it charges at current spending levels.

A report by the borough’s director of finance shows the council tax requirement will be £107m by the end of 2018 financial year.

It is currently £46.8m, meaning the authority would need to bring in an additional £60.2m.

Wandsworth Council took £9.8m out of the £34m reserves for the 2015-16 budget.

Just before Christmas, Councillor Guy Senior said he was “optimistic” about upcoming budgets and thought savings were progressing well.

He told the Wandsworth Guardian on Christmas Eve: “We will have to make savings of £40m or thereabouts.

“Even if we put up council tax to the maximum allowed by Government, that brings in just £2m.”

The PWC audit report was completed in October 2015, and released to the audit committee at the end of January.

It states: “We are aware the council is in the process of determining actions to reduce the Council’s medium term ‘budget gap’ and to update it to take into account the Spending Review when published in November 2015 and the Local Government Finance Settlement in December 2015.”

The audit report cost Wands-worth Council more than £220,000. In February 2015, the council announced it would freeze its share of tax for the second year in a row, keeping levels about half the London average.

Although £10m in savings is expected from shared staffing arrangements with Richmond Council, the move will cost £1m, to be covered by the service transformation fund.

Since the introduction of the Localism Act in 2011, any proposed increase in council tax more than 2 per cent must be put to a referendum.

This year, Chancellor of the Exchequer George Osbourne has permitted councils to increase council tax by 2 per cent.

Richmond Council, which will share staff with Wandsworth from this summer, sets its Band D council tax at £1,594.

Cllr Ravi Govindia said:  "The councils draft budget and council tax proposals for 2016/17 will be presented to the finance and corporate recourses scrutiny meeting later this month where they will be examined by members of the committee.

"We cannot pre-empt that process but clearly Wandsworth, like all councils, will have to continue to reduce its spending to help bring the national finances under control.

"To meet this challenge we will develop more efficient ways of delivering local services, including our ambitious plan to create a shared staffing structure with Richmond Council which alone has the potential to save both councils around £10m every year.

"We are also exploring ways of increasing our income and will consider market testing more of our services to find out if other organisations can deliver better value for taxpayers.

"Because of the prudent approach the council has taken to managing its finances over many years we are also able to draw on our reserves to help protect Wandsworth’s front line services and reduce the funding gap."