Gordon MacDonald, who represents Edinburgh Pentlands for the SNP, said the move, revealed by First Minister Alex Salmond last week, would protect the most vulnerable.
Mr Salmond said a “£40 million shortfall” in council tax benefit would be funded over the next year. It is proposed that £23m will be found by the Scottish Government while £17m will be covered by local authorities. More than 40,000 people in Edinburgh claim council tax benefit.
Mr MacDonald said: “I am pleased to see that both the Scottish Government and local authorities will work together to protect the vulnerable in Scotland against the Conservative-led and Lib Demsupported cuts.”.