The Montgomery County Council, looking forward to the fall re-election campaign and backward to last week's California tax cut vote, decided yesterday to reduce county property tax rates from between 7 to 11 cents for each $100 of assessed value, varying by sections of the county.

The new rates of between $3.37 and $4.20 - combined with a statewide assessment rollback approved by the last legislature - means that the owner of a typical $70,000 house in Montgomery will pay from $40 to $50 less this year than last.

Council members quickly acknowledged, however , that the tax rate cut for 1979 would likely require a propety tax rate increase of up to 40 cents on each $100 of assessed value next year to maintain the present level of county services.

"We should provide maximum responsible tax relief to the taxpayers who have been hard pressed over the past three years", said Council Member John Menke, a candidate for county executive, who offered the proposal.

Even though assessments rose about 9 per cent last year, the result of the county and state tax cuts means that most Montgomery homeowners will have lower tax bills for 1979.

But the head of the Montgomery County Taxpayers League immediately criticized the council's 3 to 4 percent reduction in the rate as "very insubstantial".

"The way my phone has been ringing all week, this is not what the taxpayers are talking about", said Karl Schlotterbeck. "They want property tax relief - that is something they can see like 15 to 20 percent decrease in their rising bills".

The council's 5 to 2 vote yesterday in a work session is expected to be formally adopted in an official meeting Tuesday.

In reducing the county tax rate Montgomery joined other suburban governments in lowering property tax rates for the fiscal year that begins July 1.

Prince George's County earlier cut its tax rate by 10 cents to establish a new levy of $4.04 per $100 of assessed value. Arlington cut its taxes 4 cents, for a new rate of 31.45. Fairfax cut its rate by 10 cents, and has a 1979 rate of 31.64, and Alexander cut its rate 16 cents for a new rate of $1.54.

Maryland and Virginia tax rates are not comparable because Virginia property is assessed at 100 per cent of it fair market value, while Maryland property - under the new assessment rollback - is assessed at 45 percent of market value.

The D.C. City Council is expected to lower the city tax rate on residential property soon by 26 cents for a new tax rate of $1.57 for each $100 os assessed value. D.C. residential property is legally assessed at its full market value, with an exemption the council is expected to increase to $9,000.

The Mongtomery County Council adopted its 1979 budget in May but put off setting the tax rate until the possible minute in case new revenues came in.

In March, County Executive James P. Gleason recommended the tax rate be cut by 26 cents, in part because the county had a $24.8 million surplus left over from this fiscal year. He revised his proposed cut down to 7.5 cents, however, after the Maryland General Assembly reduced some property taxes and rolled back assessments from 50 to 45 percent of market value.

The effect of the council's action yesterday was to spend most of the surplus.

During the meeting yesterday, council member Neal Potter, an economist, objected to Menke's proposed tax rate cut as a "drastic" measure that could create a budget "crisis" next year.

Voting with Potter against the tax rate was council president Elizabeth Scull. All councils seats are up for election this fall throughout Maryland.

Scull said she voted against the cut because of what she fears will be a "sweeping" reaction to California's Proposition 13 in Congress this year. Proposition 13 is the citizen's initiative that California residents passed overwhelmingly last week. It would limit property taxes to 1 percent of 1975-76 assessed valuations.

In addition, Scull said she was concerned that the council will "almost certainly" have to provide rent relief to county tenants next year. She said she could "vote to cut into the surplus any more".

The council's reduction will effect county taxpayers differently depending on where they live. All residents pay some combination of recreation, street and light, park and planning and water and sewer levies that are added to the basis overall county rates.

In addition, residents of a few incorporated towns, like as Rockville and Gaithersburg, are subjected to municipally imposed taxes. This week the city of Rockville cut its tax rate the highest in the county, by 8 cents, to give Rockville citizens a total rate of $4.20.