West Dorset District Council will freeze council tax - despite losing out on ten per cent of its funding from the Government.
The council will receive £571,584 less from central Government during the 2013/14 financial year.
Cllr Robert Gould, Leader of West Dorset District Council said: "These are challenging times for local councils.
"The national picture means our Government grant continues to fall, many of our traditional income streams are under pressure and, like householders, we have seen energy and fuel costs rise way ahead of inflation.
"But careful financial management, savings from working in partnership, continuous efficiencies and the move to smaller, greener and cheaper offices in Dorchester means we aim to freeze council tax and parking charges in 2013/14."
The council is also proposing no rise in parking charges for the seventh straight year and no reductions to services.
The council will confirm its share of the council tax bill on February 26.