The Auckland Council has today voted for massive household rates increases of 40 per cent or more next year for some households.

Councillors were deeply divided on how to implement big rates rises arising from new property valuations and a new rating system.

Mayor Len Brown led the case for adjusting rates in one hit next year, saying the council should not continue to tinker around the edges.

Two amendments to cap next year's rates increases at 20 per cent and talk to the Government to continue a three year cap of 10 per cent were narrowly defeated.

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The decision, which will go out for public consultation, will result in about 126,000 households receiving rates rises of more than 10 per cent, 25,000 more than 20 per cent and 3738 more than 40 per cent.

About 160,000 ratepayers, including businesses, will get a rates decrease under a complicated formula.

The overall rates increase is 3.5 per cent. The average household increase is 5.6 per cent.