Labour MPs urge property tax reform that could raise South East bills
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Labour MPs are urging Chancellor John Healey to replace council tax and stamp duty with an annual tax linked to property values. The proposal is intended to reform a system they say is unfair and ease bills in areas where Labour has lost support, but it would raise charges for many households in London and the South East.
Campaign group Fairer Share proposes a 0.48 per cent annual tax on homes. It estimates an average bill of about £748 in the North East and £1,824 in the South East, while saying 77 per cent of households would save an average of £550. The group also warns that council tax bills for low and middle-income households could rise by £900 over the next decade without reform; polling it cites found support for a property-value tax among voters across several parties.
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In short
- Labour MPs want council tax and stamp duty replaced.
- The proposed 0.48 per cent tax would vary sharply by region.
- Fairer Share says most households would save money.
How this story developed
- 17 minutes ago Labour MPs are urging Chancellor John Healey to replace council tax and stamp duty with an annual tax linked to property values.
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The case for
Supporters argue that an annual tax based on current property values would replace council tax bands that can leave similar homes with very different bills, and remove stamp duty’s upfront cost when people move. Fairer Share estimates that 77 per cent of households would save, and advocates say reform could make the system fairer while limiting future increases for low- and middle-income households.
The case against
Critics can argue that linking bills more closely to property values would burden households in London and the South East, including people whose homes are valuable but whose incomes are modest. They may also question whether replacing two taxes with a new annual charge would deliver the forecast savings, and favour targeted changes to the existing system over a nationwide redesign.
Explained simply
Council tax is a yearly charge set by local councils to help pay for services, and most homes are placed in bands based on their value in 1991. Stamp duty is a tax people usually pay when they buy a property. Labour MPs and campaign group Fairer Share want these taxes replaced by a yearly charge based on current property values.
Fairer Share proposes a rate of 0.48 per cent of a home’s value. Its estimates suggest bills would differ by region, with an average of about £748 in the North East and £1,824 in the South East; the group says most households would pay less, while many in London and the South East could face higher charges.
The proposal has been put to Chancellor John Healey as part of a wider debate about how property taxes are shared between households and regions. Any change could affect household budgets and the money councils receive, so its likely costs and effects would matter to people who own or buy homes as well as local services.
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Originally published by Daily Mail as “Call for new property tax that would hammer the South East”.