Andy Burnham, the Labour MP for Makerfield and widely expected successor to Sir Keir Starmer as Prime Minister, is planning a tax rule change that would affect 150,000 households. According to the Daily Mail, drafts have been prepared to lower the threshold for an additional levy on properties valued at £1.5 million or more. This would result in four-figure tax hikes for more than 150,000 families, particularly those in the south of England.
Proposed Reforms to Council Tax
Burnham is also considering a reform of the council tax system, replacing it with a levy based on land values. This move could leave people living in the south paying up to three times as much as those in the north. The Labour MP has long supported a land value tax (LVT), a yearly levy on the value of private land, which he previously hailed as "very productive" during his tenure as Mayor of Greater Manchester. He argued that such a tax would encourage landowners to use land rather than hoard it.
Impact on Homeowners
Research indicates that a 1% LVT would hit some homeowners much more than others. Sources speaking to The Telegraph noted that average council tax bills are currently higher in the north than the south, but a 1% levy would reverse this. Analysis by the same publication suggested that adopting LVT would result in southerners paying an annual average of £1,650, while northerners would see bills of £600.
Political Reactions
Shadow Secretary of State for Housing, Communities and Local Government, Sir James Cleverly, criticised the proposal, calling it a "garden tax" straight out of former Labour leader Jeremy Corbyn's playbook. He said LVT is a tax on aspiration that would punish families who have worked and saved hard to invest in their homes.
However, Patrick Hurley, the Labour MP for Southport, told Fairer Share that his constituents know the current council tax system is unfair. He stated: "Families here work hard and shouldn’t be asked to shoulder a bigger burden than wealthier parts of the country."
Burnham's Stance
Burnham has expressed his desire to see council tax reformed while campaigning in the Makerfield by-election. The proposed changes come amid broader discussions about tax policy and could be implemented alongside other tax rises if Burnham becomes Prime Minister.
