Mayor Andy Burnham has voiced concerns regarding potential increases in council tax for homeowners in southern England, citing what he described as "unfairness" in the current system. His remarks come as the Prime Minister indicated that previous reforms to council tax were a "right start" and hinted at further considerations for the tax structure.
Burnham pointed to instances where residents in the North West pay higher council tax on smaller properties compared to larger homes in London. He referenced the former Chancellor Rachel Reeves' introduction of a surcharge on higher-value homes, a measure often referred to as a "mansion tax," as a step towards greater equity.
"There are people here in Greater Manchester who pay a much higher council tax than people living in much larger homes in London," Burnham stated in an interview. "So the Chancellor before, Rachel Reeves, was right to start to reform council tax to create some fairness there in relation to people in homes that are of much greater value, who haven't seen their council tax go up over the years because of the failure to revalue the banding."
Downing Street, however, moved to quell speculation that the government is actively considering replacing council tax and stamp duty with a new levy based on property or land values. Such suggestions had prompted accusations from opposition parties of a potential "raid on Middle England."
The Prime Minister's official spokesperson clarified that "decisions on tax are a matter for the Chancellor [John Healey] to set out at fiscal events," and stated that reports of major reform plans were "not true."
Burnham acknowledged that "big decisions lie ahead" regarding council tax but emphasized a "cautious approach" to public finances, stressing adherence to fiscal rules. He previously expressed being "persuaded" by arguments for reforming the council tax system.
Reform of the council tax system has also been a topic of discussion among some Labour backbenchers. Jonathan Brash, MP for Hartlepool and chairman of a cross-party group on council tax reform, has called for "wholesale reform," noting that properties in band A in Hartlepool pay nearly 2.5 times more council tax than similar band homes in Westminster.
Conversely, Conservative figures warned that any potential changes signaled Labour's intention to increase taxes on homeowners. Shadow housing secretary James Cleverly stated that replacing council tax and stamp duty would result in higher costs for "people across England," and accused Labour of having already increased both taxes. The Conservatives maintain they are committed to reducing taxes on family homes, including through the abolition of stamp duty for primary residences.