Rates in some Perth councils are "getting out of control" in part because small councils can be less efficient than their bigger counterparts, according to Colin Barnett.
Highlighting what he said were discrepancies in rate bills between councils, the Premier said rates should not rise after amalgamations and the rate at which they increased should slow.
His comments came as Perth councils flagged rate slugs of between 3 per cent and 6.3 per cent for 2014-15.
They also contradict council warnings of rate increases or service cuts because the State Government has not provided enough funding for reform.
"Some of the rate increases and rate levels around Perth are really getting out of control," Mr Barnett told ABC Radio. "Rates shouldn't go up at all through amalgamations, if they occur.
"Good-sized, efficient local authorities can improve efficiency."
Perth councils are working on 2014-15 draft budgets, with many yet to release rate forecasts.
The cities of Gosnells and Vincent have proposed rate increases of 3 per cent and 3.6 per cent respectively and the Town of Cottesloe has proposed an average 4.1 per cent increase.
The cities of Perth and Fremantle have both flagged average increases of 4.9 per cent, the Shire of Peppermint Grove has forecast a 5 per cent increase and the Town of Claremont has flagged a 6.31 per cent hit to ratepayers, about one-third of which was attributed to a jump in waste management costs.
Peppermint Grove chief executive John Merrick said the focus of the shire, Perth's smallest, was on community satisfaction.
"We've held several meetings with our community and it has always come through: rates aren't as important to them as service and their expectation of local government is being somebody that can look after their day-to-day issues and that's certainly our focus," Mr Merrick said.
Claremont mayor Jock Barker said higher land values in many of the smaller western suburbs councils also played a role in pushing up rates.