Australia's largest council says the federal government's carbon tax is to blame for almost half of the rate hike announced in its 2012/13 budget.

Brisbane City Council handed down its $3.1 billion budget on Wednesday, saying rates would go up by 4.5 per cent.

That means the average ratepayer will have to find an extra $54.52 a year.

Lord Mayor Graham Quirk said the rise could have been kept to 2.6 per cent, or $31.48 a year, if not for costs associated with the carbon tax, including landfill charges.

"The carbon tax is federal Labor's gift to itself that will keep on giving despite the successful efforts of Brisbane ratepayers to reduce their carbon footprint," he said.

Mr Quirk said he'd kept an election promise to keep the average rate increase to five per cent or less.

He noted the rise was below the average annual increase in valuations across Brisbane of 5.76 per cent.

Mr Quirk said the budget was about boosting the potential for economic growth in the Brisbane City Council area, and helping create a cleaner, greener and more accessible city.

The budget includes $1.4 billion to tackle traffic congestion and improve road safety.

That money includes $465 million to start tunnelling work on Legacy Way, linking the Western Freeway at Toowong with the Inner City Bypass at Kelvin Grove.

There's also $10.5 to improve ferry terminals and $7.7 million to upgrade bus stops, and $27 million for more bikeways.

Federal Treasurer Wayne Swan told parliament the council would have trouble explaining how the carbon price was behind the rates hike.

Mr Swan said it was just a cash grab by Brisbane's Liberal administration.

"That is what it is, and I think the Brisbane City Council are going to have a lot of trouble demonstrating the claims that they are making," he said.

"For example, $11 million is claimed to cover a rise in inflation of 0.7 per cent.

"But that is based on the average price increase for households, and councils will be subjected to smaller price increases, and the list goes on."

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