Shaldon Parish Council has agreed to increase its precept by 20% to plug a hole in its finances.
Residents in a Band D property will see an additional £10.39 added to council tax bills this year to contribute to the running of Shaldon Parish Council.
Shaldon Parish Council is forecasting a £12,000 overspend, which would use up virtually all of its reserves.
The Parish Council said increased costs were due to Teignbridge District Council asking it to take on more responsibilities.
Councillor Chris Clarence pointed out that it is important for the Parish Council to ensure it has reserves due to uncertainty about whether the Parish Council might be asked to take on even more responsibilities if government plans to create a unitary authority for Devon and Cornwall go ahead.