Ministers have accused councils of wasting millions of pounds by giving staff "preferential" motoring perks.
The criticism came after research found that local authorities paid up to 65p a mile last year for employees to use their own cars for work.
Lancashire, Derbyshire, Cornwall and Warwickshire were among those offering the top mileage, according to the survey by campaign group the TaxPayers' Alliance (TPA).
The average rate across the UK was 56.4p in 2010-11 - well above the HM Revenue & Customs-approved level at the time of 40p. That meant the typical council worker would have ended up £164 better off for every 1,000 miles driven.
The study found that local authorities paid staff a total of £427 million in mileage allowances in 2009-10, up from £402 million in 2008-09.
TPA director Matthew Sinclair said: "Ordinary motorists who are feeling the pinch will be shocked that council staff are getting such a generous deal for their mileage claims. It simply isn't fair.
"Some authorities have shown that it is possible to save millions by cutting back to the rate recommended by the taxman.
"This is a quick and painless saving that won't affect council services and will ease the burden on households, who've seen council tax double in the last decade."
Local government minister Bob Neill said: "Town halls are wasting millions of pounds of taxpayers' money by these preferential and privileged motoring perks.
"Every bit of the public sector needs to do their bit to pay off the budget deficit. Simple changes like clamping down on these subsidises will help councils drive down unnecessary costs and protect frontline services."
