Andy Burnham's political mentor, Lord Blunkett, has cautioned that a proposed land value tax (LVT) would take many years to implement and likely spark fury in London and the South East of England. Lord Blunkett stated that imposing annual charges based on a percentage of land value would be "politically problematic" and "dislocate the system because of the winners and losers."

The warning comes amid predictions that a shift from current taxes like council tax and stamp duty to an LVT could result in substantial bills for millions and cause property prices to decline.

Burnham has previously expressed that he is "persuaded" by the argument for an LVT, which would be based on the undeveloped value of land. While the precise structure of such a tax remains unclear, modeling by the think tank Tax Policy Associates suggests a significant impact on the capital and surrounding counties, with other regions potentially benefiting.

According to the Tax Policy Associates' illustrative estimates, an annual levy of 1.28 percent of land value could replace current revenues from council tax and stamp duty. However, the model indicates that some households could face annual bills exceeding £50,000. For instance, owners of a band F flat in Islington might see their annual tax rise from £2,900 to £12,000. In affluent areas like Westminster and Kensington, owners of band H properties could face annual charges of £44,000 and £54,000, respectively. Outside the M25 motorway, a band F home in Guildford could see its charge increase from £3,500 to £6,200 annually, while a similar property in Brighton might face an £8,700 bill, up from a comparable council tax amount.

The report acknowledges the possibility of transitional arrangements, such as credits for stamp duty already paid. It also highlights that delaying the collection of the tax would necessitate a significantly higher percentage charge.

The modeling projects considerable drops in property values in affected areas, with an estimated 19 percent decline for average homes in Richmond-Upon-Thames. The report references a 20-year phasing-in period used in Australia as a potential model for implementation.

Lord Blunkett, a former Cabinet minister under Tony Blair, described a transition to LVT as a "10-year project," emphasizing that it "cannot happen in the immediate future" and requires a balance of "grounding of reality in politics, as well as radical thinking."

Liverpool Metro Mayor Steve Rotheram, an ally of Burnham, also commented on the potential impact on individuals who are "capital rich" but have limited cash flow, noting that implications and considerations would need careful development, with fairness being a key driver.