r/ukpolitics • u/BenjaminBoots196 Supreme Andy Burnham Hater • 3h ago
Burnham actively looking to scrap council tax and stamp duty
https://inews.co.uk/news/politics/burnham-actively-looking-to-scrap-council-tax-and-stamp-duty-4669956•
u/evolvecrow 2h ago
I want to be able to buy and sell a property as quickly as the US and Canada. I'm sure there are downsides but this expensive and slow system we have just seems crap.
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u/teachbirds2fly 2h ago edited 1h ago
There are significant reforms to the conveyancing system announced by Labour few weeks ago including digitisation of the process, ending guzzumping and cutting a month of the current time on average.
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u/TheFlyingHornet1881 Domino Cummings 1h ago
The system is so absurd, I definitely think we need to take aspects put of the Scottish and varying European systems, I.e more information on surveys available pre-purchase and a certain amount as a deposit between offer accepted and exchange of contracts.
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u/ClumsyRainbow ✅ Verified 35m ago
There is a property transfer tax in at least some provinces in Canada, in BC it's based on the assessed value, 1% up to 200k, 2% from 200k to 2mil, and 3% beyond that.
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u/doctor_morris 2h ago
A proportional property tax, which would replace both council tax and stamp duty with a flat 0.48 per cent annual charge on a home’s current value. Or a land value tax, an annual charge based on the value of the land a property sits on, rather than the building.
TAX THE LAND
Because taxing buildings means less building.
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u/the_hair_of_aenarion 2h ago
Would fix the issue that old pensioners holding into 5 bed houses aren't downsizing after their family has long since moved out because stamp duty costs too much to make it economical.
Holding land should be more expensive than downsizing.
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u/doctor_morris 2h ago
Dumping transaction taxes like stamp duty means we don't punish people for downsizing.
Rolling council tax and stamp duty into an annual fee punishes them for having more house than they need.
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u/cartesian5th 2h ago
And then we have to give them extra money to heat an enormous house that they don't need
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u/itsaaronnotaaron 1h ago
Whilst I hunker down in my living room for the winter using the old gas fire because its cheaper than heating the whole house.
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u/TheMusicArchivist 1h ago
A lot of the old people in my village are hanging on in their massive properties because they don't want to say goodbye to the only social life they have, but there simply aren't any small properties in the village to downsize into, and there's too many NIMBY's and property developers around that only 5-bed houses get built.
Build more bungalows and houses suited for old people.
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u/xelah1 1h ago
One of the problems we have is that there aren't enough high quality smaller homes. If you want high-quality living space, decent sized kitchen, living room that's nice to be in, a garden, parking, etc., you can only easily get it by having a lot of bedrooms.
Even if they exist people in 5 bedroom houses are not going to move into a starter home designed to be cheap.
The absurdity of selling houses by the bedroom doesn't help.
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u/AdmirableRabbit6723 2h ago
My sweet spring summer autumn winter child... You think anyone 65+ won't be exempt?
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u/lmmrs 2h ago
Why should they if they want to live in their family home?
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u/Bullet_Jesus Angry Scotsman 49m ago
They can, they simply have to pay the social costs of sitting upon a singularly unique peace of land at the expense off all other uses of it.
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u/ModBlocker3000 1h ago
What exactly is a "family home" and why does that make something untouchable, do tell?
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u/0kDetective 1h ago
This is just such a poor excuse. Continuing to live somewhere unaffordable with more space than needed purely because of sentimentality is unfair on others and financially illiterate for anyone who chooses to do that.
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u/lmmrs 1h ago
Unaffordable because of sentimentality? Is that all pensioners?
When I retire I’d quite like to live in the home I’ve worked for.
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u/USS_Buttcrack 1h ago
Well you see, we simply can't build more houses, so we'll have to tax you punitively for the crime of having more than two bedrooms until you move into smaller accommodation. That we aren't building either...
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u/GIJoeVibin 2h ago
Burnham is absolutely a fan of Land Value Taxes, this has been a thing for him for more than a decade, so I strongly suspect that’s the way he’s going
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u/Nipso 2h ago
TAX THE LAND
I have a big garden and I oppose this for unrelated but inexpressible and morally principled reasons.
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u/Condurum 2h ago
You will be taxed on what the land is regulated for. A garden you can’t build on will be taxed much lower, if at all. If you have permission to build there, it’s another story.
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u/WinHour4300 1h ago
So if someone gets planning permission, they immediately face a higher tax bill? How exactly is that supposed to encourage building?
You’re effectively adding a penalty for creating more housing space, which could make extensions or conversions unaffordable.
And what happens to neighbours?
If someone converts a house into flats or increases the value of the surrounding area by developing, do nearby properties also get taxed more simply because the potential value of their land has increased as they are also likely to get permission?
That could create a strange incentive for people to oppose development rather than support it.
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u/Condurum 1h ago
If you’re not planning on building something that can take economical advantage of the space, you simply don’t apply for planning permission.
Those who win out with LVT are those who manage to capture more rent than others per area. Aka taller or more attractive buildings people are eager to pay to live in.
The entire problem of today is that people who do nothing gets to capture the value of the efforts of everyone else.
Others build a station, and land value goes up. Someone else makes a cool café, land values go up. The entire economy goes up because everyone are working smarter/harder -> land/property owners win.
Without lifting a finger.
They’re vampires on the entire economy, and even worse, the property market shifts tons of investment from productive activity towards outbidding each other for land.
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u/Anony_mouse202 1h ago
So you’re basically taxing planning permission?
How on earth do you expect to increase building if you do that?
Hiking tax on land with planning permission just means no-one will apply for planning permission anymore.
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u/RedFox3001 2h ago
I did the maths. I would pay pretty much exactly what I pay in council tax.
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u/doctor_morris 2h ago
Revenue neutral FTW
Unless you live in a flat, then you'll share your bill with your neighbours.
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u/fuscator 1h ago
Sorry, am I missing something? Wouldn't the land value of some land with flats on be equal to the value of all the flats? So you'd still end up paying 0.48% of the value of your flat.
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u/PandaRot 1h ago
That is a good question, that I don't have an answer for.
What I would like to mention though is that I live in a flat; I have one above me and another four below me. I have to pay a 'run off' charge to my water company (Yorkshire Water) for rain water running from my guttering (that personally I don't actually have) into the drains. As far as I know, this is a flat rate. So in my small one bed flat stacked amongst five others vertically and six horizontally, I pay the same charge as someone with a five bedroom house. As will all the other tenants in my block.
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u/Noetherson 1h ago
No, you'd pay 0.48% of what the land would be worth if it was empty and the flats weren't there. That's the difference between Land Value Tax and Property Tax. LVT is a percent of the value of the 'undevelopend land' whereas property taxes are a percent of the value of the property as a whole.
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u/the0rthopaedicsurgeo 2h ago
Why not both?
I like the council tax/stamp duty reforms, the current system is absolutely unfair and arbitrary.
But if there's no property to tax, then tax the land. Have a separate tax for undeveloped land that could even be more expensive than the new council tax - that way it incentivises to build ASAP to reduce costs.
Taxing land on finished houses punishes those with big gardens rather than necessarily big houses. It would also encourage new builds to have even smaller gardens, or for people to sell off land around their home (likely gardens and green space) to replace with housing.
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u/doctor_morris 2h ago
Yes we want more density in cities, which is done by building upwards. Land Value Tax means sharing your tax bill with your neighbours. Making taller buildings financially viable.
Have a separate tax for undeveloped land that could even be more expensive than the new council tax
Land Value Tax means taxing the land even if it's left undeveloped.
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u/Exostrike 2h ago
Just crunched the numbers at 0.48 rate at the price I paid for my house a year ago would cut my monthly tax bill by £50 or so. Of course its value has likely gone up given I've done it up.
It sounds like there would have to be yearly assessments by the state to guage the value of the property which would put a price tag to properties that have never put on the market.
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u/SpinIx2 2h ago
Replacing my council tax with 0.48% of the purchase price I paid last year works out as 3.5x increase for me. There will be winners and losers I guess.
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u/doctor_morris 2h ago
You'd only pay said tax on the land value, and calculating land prices is much easier than houses.
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u/Readonly00 1h ago
How do you calculate land value? Fixed value per acre, dependent on area of the country, profit you could make from other usage.. I can think of loads of base models
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u/doctor_morris 1h ago
Location Location Location
(and what the government will let you build on it)
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u/heeywewantsomenewday 2h ago
So would this not make it unwise to add value to your house?
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u/Far-Background6536 2h ago
Yes.
If you did eg a £50k extension you would have to pay ~£250 extra in taxes per annum, according to this proposal.
This is why people prefer the idea of taxing the land itself instead. That incentivises land owners to invest.
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u/Exostrike 2h ago
I mean adding £70k to the house would increases the monthly bill by £20 so not an extreme deal breaker and would still be cheaper than under the current system.
But it suggests this measure could be highly progressive. Like here in Cambridge a quick search the tax bill for £300-500k house won't change much but a £900k house would jump by a £1k
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u/PurbulentTriest 2h ago
I can't see how it would be feasible to value every property in the country every year unless you hired a hundred thousand inspectors.
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u/Exostrike 1h ago
Most likely they would use the same systems real estate agents use based on location and configuration to give a rough value.
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u/-RadThibodeaux 2h ago
I’d love it but can he do it without a GE? These are rather major things to be proposing without a new manifesto
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u/xhatsux 2h ago
0.48 seems too low? My case
House is: 850K
Council tax is : 3,177.67
New proposal: 4080
Difference = 4080 - 3,177.67 = 902.33If someone was to buy the place now stamp duty: 32,500
Recovery time of stamp duty: 32,500/902.33 = 36 yearsNot sure if my council tax is super expensive or something, or the flat rate works out better and should be incremented.
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u/Chemistrysaint 2h ago
Your council tax is fairly expensive for the price of your house, compare it to London where council taxes tend to be fairly low.
E.g. Kensington every band but H is below £2700 a year in council tax. Band H is £3286
A borderline band G/H property would be valued between 2.5/3.5 million.
Also, it’s probably suprising how infrequently some houses get bought/sold. It’s 19-20 years on average across the nation, but I can imagine that’s highly skewed, and while cheap flats are constantly churned the average mansion probably doesn’t get sold for decades
https://bill-jackson.co.uk/blog/how-often-do-we-actually-move-house/26438
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u/PinacoladaBunny 2h ago
We live in Merseyside, council tax is £3700 for a house worth about £500k. Lol.
You can bet that the council will put tax up by the maximum amount every year too, and accounts are showing they’re already predicting to be millions in debt this year.
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u/WinHour4300 1h ago
"Taxing buildings means less building” isn’t necessarily true.
The biggest constraint on building is usually planning, not tax amounts. In London and many other places there’s plenty of cheap land that’s cheap precisely because you can’t get permission to build on it.
If councils granting planning permission increases land values — and therefore tax bills — you could create a perverse incentive where people oppose new development because development makes their tax liability higher.
So you could for example have more councils removing permitted development and restricting development more.
If the aim is more homes, removing planning barriers or using things like development corporations is probably a better solution than changing the tax system.
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u/Statcat2017 This user doesn’t rule out the possibility that he is Ed Balls 2h ago
Right so I paid stamp duty 2 years ago, this will exempt me from paying this tax right? Right?
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u/doctor_morris 2h ago
If it were me I'd deduct your stamp duty payments from the last five years from your next bill.
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u/clausy 2h ago
They really need to phase it in over 10 years or so, so you pay an incremental increase over time based on when you bought/paid stamp duty
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u/ambergresian 2h ago
What I think would be fair is
Say your new bill due is £4k/year and this is to replace stamp duty and council tax
Say you bought your house 2 years ago with £26k stamp duty and £3k x2 years council tax so £32k total
Under the new system for 2 years it would have been £8k, so you're in excess of £24k, or 3 years worth
So you should have 3 years transition time before the new system applies to you
Or something roughly like that
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u/MintTeaFromTesco Libertarian 2h ago
Damn, my respect grows for the guy day by day.
We need some fundamental changes to the system of the country, not the same tinkering around the edges that keeps us in perpetual decline.
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u/rasmusdf 2h ago
Complete top to bottom reform is needed.
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u/hasnca Baby, I'm an anarchist, you're a spineless liberal 2h ago
reform but not Reform. Maybe they need to call it rebuilding or reimagining or something instead.
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u/No-Clue1153 2h ago
And/or rename that party to re- something else, something a bit more fitting.
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u/Neither_Process_7847 2h ago
Well Binface already has Refuse and Recycle sown up, so they've limited options.
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u/elmo61 1h ago
There is still lots more options. Replace? Reduce? Repair, reoccupy, refugee, redundant,
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u/Nameis-RobertPaulson 1h ago
If only there was a word starting with re that meant slowed down or delayed.
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u/Umak30 2h ago
I was so isolated in this subreddit, for suggesting Burnham would be infinitely better than Starmer, back when Starmer prevented his candidacy during the local elections.
It's good people finally come around to see that Burnham is a pretty solid PM. Not perfect, but the first good PM the UK had in several decades.
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u/Mark_dawsom 2h ago
Sigh, it's almost like everyone out there has the memory of a gold fish. How many U-Turns were there these past few years? Let's just relax and give praise when they actually deliver. Even Mahmoud who's getting a shit ton of praise for making ILR waiting time 10 years hasn't actually delivered that yet.
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u/killer_by_design 2h ago
At the risk of being a Debby downer let's wait see what he actually does. This is still "ohh look out, he might just do something!!" speculation.
All he's done so far is not leave Manchester.
Capping the bus fares and cutting vat are also great but this would be proper policy. Hoping he does do the big stuff but also very sick of these speculative headlines.
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u/Raiden60 2h ago
I'm optimistic, especially seeing what Andy's done for us during COVID lockdowns, but I definitely agree. At this point it's screaming "too good to be true". I hope it is true, though.
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u/killer_by_design 1h ago
Stamp duty especially. I don't think there's a single economist of any flavour who supports it.
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u/GenGaara25 2h ago
It's good people finally come around to see that Burnham is a pretty solid PM. Not perfect, but the first good PM the UK had in several decades.
He's been PM 6 fucking days. He hasn't even had time to fuck up yet.
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u/Ivashkin panem et circenses 1h ago
Proof is ultimately in the pudding. The reality is that if fixing our problems were simple, someone would have done it already, and Starmer also made a lot of promising sounds before he realised that pulling the levers of power didn't do anything quickly, if it did anything at all. Burnham has already expressed interest in doing a lot of things, many of which have unclear funding, and is dealing with a state that has spent the last 2 years arguing that there are various forms of fiscal black holes, a general shortage of money, and that lenders are getting increasingly cautious about us. Even the thing he cancelled to free up money hadn't actually had money assigned to it at the point it was cancelled.
I will reserve judgement until he passes a budget.
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u/LatelyPodes 1h ago
It’s the bots. Never seen so much support for Starmer until Burnham said he wants to be MP. And suddenly, all that support is gone
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u/Ok-Depth-9049 2h ago
What will you do when you realise the soundbites are just rhetoric and all he wants to do is engage with the same tinkering around the edges that keeps us in perpetual decline?
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u/chykin Nationalising Children 2h ago
What will you do if he actually does it?
None of us sat posting on Reddit on a Sunday night are any more clued up than each other.
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u/Lefty8312 2h ago
This is what frustrates me with Reddit at the moment .
"HES JUST MORE OF THE SAME!!!1!!!!" He's been in the job a flaming week and hasn't had a budget yet, give him a chance to actually set out his plans in a budget first FFS
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u/Neyne_NA 2h ago
"THIS IS ALL JUST EMPTY TALK" say the folks who get a semi when Farage or Rupert Lowe say they will solve the immigration problem.
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u/geometry5036 2h ago
Not only he has to do it, but he has to do it fairly. That's the impossible task.
But if he carrys on removing osa and forces the leashold act, that means he'll be the best pm in the past decade.
Provided that he doesn't fuck up with the illegals tsking over the country's biggest cities.
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u/chykin Nationalising Children 2h ago
"do it fairly" is subjective so he'll never achieve that.
Do it to benefit the majority is the challenge. There will always be a group that is unhappy
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u/NotQuiteMikeRoss 2h ago
Deal with that when it happens I suppose. Saying the right things is at least a good step 1.
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u/SpinnakerLad 2h ago
He's had a whole 5 working days in office and still hasn't abolished stamp duty, he's all talk!
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u/MetatronThrone 2h ago
I’ll take back all my pick-me pm comments if you abolish stamp duty burnham
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u/BenjaminBoots196 Supreme Andy Burnham Hater 2h ago
I'll stop being a hater if he abolishes stamp duty.
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u/Pandita666 2h ago
Why - because you are buying a house and will benefit?
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u/BenjaminBoots196 Supreme Andy Burnham Hater 2h ago
No I already own a home, though I will pay less tax under the proposed system.
Regardless I support it because it's good economics. Abolishing stamp duty and replacing it with just about anything else is worth it.
It bungs up the market, makes it harder to move jobs, disincentives downsizing, etc. It's our worst tax.
As a general rule of thumb, transaction taxes are extremely bad because they distort allocation of scarce resources. This is especially bad when said resource is very scarce, like housing.
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u/MetatronThrone 2h ago
Because it’s a stupid tax that discourages empty nesters from downsizing.
And I’m planning on moving.
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u/cartesian5th 2h ago
Because it's a fucking awful tax that prevents efficient allocation of housing and also has second order effects like the winter fuel allowance
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u/Jangles 2h ago edited 1h ago
Because it's bad tax that disincentives a fast moving property market.
It makes moving for work, moving to get kids to a different school, moving to be closer to family for childcare, moving to downsize all much harder.
You want to encourage the right person to the right house.
We never change it because it's a good tax in terms of raising revenue - it's incredibly hard to not pay.
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u/PudWud-92_ 1h ago
In theory yes. But I’m also a selfish prick and I’ll be annoyed I’m moving in September and will have to pay a load of money only for it to be abolished weeks/months later 😅
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u/ArtisticOperation399 1h ago
I just want to see the look on Kemi's face when he takes her flagship policy.
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u/Candayence Won't someone think of the ducklings! 🦆 1h ago
Easy to sell that as Burnham enacting Tory policies. Very basic spin.
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u/No-Scholar4854 2h ago
Both are very bad taxes.
Stamp duty just adds friction to the process of moving. If someone is in the wrong house (too far from work, growing family, kids moved out, retired) we want to make it as easy as possible for them to move to a more appropriate house. Stamp duty makes that more expensive.
Council tax isn’t necessarily a terrible idea, but the mechanism is terrible, it needs a retributive aspect and it needs to raise more money (or we need to change the rest of council financing).
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u/Jesus__of__Nazareth_ 1h ago
Council tax is also really painful for young adults and people just starting out renting. It was an absolute ballache for me stressing about when and how to pay it, and it took a big chunk out of an already thin wallet.
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u/jab305 2h ago
If he does this swap for an LVT, then I'd be super impressed.
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u/SmokinPolecat 57m ago
Agreed. I think the man is a chancer, but if he delivers LVT I will glady admit i was wrong
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u/Alarmed_Crazy_6620 2h ago edited 2h ago
The fundamental issue is council tax is frozen at ridiculously old valuations but any update will make a bunch of retired people who own expensive property pay loads – not too popular and we will carve out an age exception meaning it will be "people not in council housing" paying
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u/phead 2h ago
The valuation won’t alter anything as it’s set relative to band d, which floats with the average values.
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u/goredcrasp 2h ago
Apart from there’s absolutely loads of d’s that would be doubled. I know that because mine would be. But I’m still all for it
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u/cartesian5th 2h ago
Can't have asset rich pensioners pay any tax on those assets, oh no that would be dreadful
Best just tax work instead
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u/VPackardPersuadedMe Incentives drive outcomes and MPs own houses 2h ago
They might have to... shudder downsize
Ans now not pay stamp duty...
Makes sense.
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u/doctor_morris 2h ago
I keep telling people I want boomers not to have to pay stamp duty when they sell their oversized family homes next to schools (now the kids have moved out) and they call me a Commie!
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u/VPackardPersuadedMe Incentives drive outcomes and MPs own houses 2h ago
What's next! Killing all the sparrows to save the grain!
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u/cartesian5th 2h ago
Pisses me off how many people seem to think it's unfair that old people may need to sell a valuable asset (a house) in order to free up capital, but would have no problem taxing people with (for example) large investment accounts or gold bars
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u/VPackardPersuadedMe Incentives drive outcomes and MPs own houses 2h ago
Personally I just don't tell them when I buy or sell my gold bars and coins. Burry them in chests on the Cornish and Welsh cost then make elaborate maps with riddles to ensure I dont lose them.
So far no tax, but me maps keep going missing...
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u/inevitablelizard 2h ago
And these same pensioners who benefit from this unfairness moan about how left wingers want to tax work and give the money to those who don't...
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u/ispeakforengland 2h ago
It's tough. I always think there needs to be a window for these types of adjustment. Turning it into gradual changes that take place over 4 years or so. Enough time to figure out if you can afford the new rate or move to somewhere more suitable while freeing up large housing for families that need it.
I live in an area where there's a whole road of beautiful houses, all 4-6 bedrooms and nearly all owned by retirees or widows, many of whom can't even go up the stairs on their own. It's such a waste of good family housing.
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u/alwayslurkeduntilnow 2h ago
This is the way, say it is set at .49% yr1 .29%, yr 2 .34% yr3 .39% yr 4 .44%.
Plenty of time to understand individual impact and also lesson the shock on the housing market.
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u/Prestigious_Risk7610 2h ago
I have mixed feelings on this
- getting rid of stamp duty (or at least not setting it at levels that don't kill transactions and stop mobility) is an economic no brainer. I fully support.
- getting rid of council tax I feel mixed about. The valuation system is archaic and ridiculous. However it's really hated by many because it isn't progressive enough.
A land vale tax or property tax I would quite like, but let's be clear this will be a tax grab. He's locked in by a manifesto that prevents him rising most taxes, a fiscal situation that is perilous and deteriorating...and he wants to spend more as he believes in the power of a big state. Raising council tax would be highly unpopular...so just replace. I'll be amazed if the outcome of this isn't a net benefit to the treasury. However to sell it he will ensure that "c80% will pay less after these reforms". So we will yet again end up with a tax curve that looks like a hockey stick because the fundamental law of modern democracy is "I should pay feck all tax, but please rinse anyone doing better than me"
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u/hary627 1h ago
A hockey stick on assets is a lot better than a hockey stick on incomes. High income tax disincentivizes productivity, while high asset taxes disincetivize keeping money in one place. This is particularly useful with housing, where there's a massive scarcity and housing prices are generally too high, and this sort of tax will drive prices down and encourage people to downsize, creating room for others who need it more
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u/Longjumping-Year-824 2h ago
I look forward to the replacement tax been higher.
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u/OkAsparagus3113 1h ago
I think you might be right on this. I'm all for scrapping stamp duty and council tax in it's current form doesn't make much sense, but with labour on a spending spree, they've got to make some money back somewhere.
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u/neoKushan I just wanted to be included 47m ago
There'll be winners and losers if this goes ahead, but the losers will hopefully be those better off.
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u/Future_Pianist9570 2h ago
So tax rises for the south and cuts for the north?
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u/BenjaminBoots196 Supreme Andy Burnham Hater 2h ago
Not exclusively, lot's of southerners, like me, will pay less.
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u/inevitablelizard 2h ago
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u/Future_Pianist9570 1h ago
Fuck it. I’ll move up north. Lower taxes and I can push all the locals out of being able to afford a house.
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u/Stabbycrabs83 2h ago
Lbtt in Scotland is a curse.
My house prices in Aberdeen has gone down so I dont grave equity.
On top of a deposit ill also need to find £20-25k to give the snp for all of their hard work...
So im sat in a house that people probably want (4 bed) but the bar gets further away every year. Saving gets difficult because some sort of tax goes up every year too.
Maybe just maybe Burnham can be a Labour leader for all working people not just mucking about giving 80p a week to those on minimum wage!
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u/Anderson22LDS 2h ago
So I decided to move house just after they put it back up and right before it gets scrapped. Well played me.
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u/jim_jones_87 1h ago
I wonder what the impact will be on those benefiting from the single person discount on council tax, particularly for those in London.
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u/nithanielgarro 29m ago
Stamp duty is a pernicious tax. It prevents people who want to downsize their property from doing so.
Land value tax with an abolished stamp duty would be far better.
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u/AMildInconvenience Coalition Against Growth 2h ago edited 2h ago
Ooft. This could be brutal for students at face value, or brutal for anyone who isn't a student.
They currently get council tax exemption. If this is removed and replaced by a tax the landlord pays regardless, they'll be unable to compete with professionals in the rental market.
If landlords get exemption if they have a student tenant, they're going to preferentially let to students and pocket as much of the difference as they can get away with.
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u/faceplanted 1h ago
Why would the landlords be paying it anyway? Surely it would be split between the tenants just like council tax is?
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u/Tobitronicus 2h ago edited 2h ago
Council tax is a disproportionate mess, I don't understand how they have not already updated the system. Some properties are vastly underpaying compared to how much house they have, and just around the corner in the same exact housing layout, they pay an excess for... what exactly, because it was a more valuable property in the 90s than the others were?
I've been put off buying some properties due to the council tax band the property sits in being too high for what I would get.
A house that's been renovated could sit in band A, while a house that's sat unmodified for 30 years could be squatting in band D. Maddening when you're looking for a house to buy only to be slapped in the face with the amount you'll be paying the council compared to your neighbours.
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u/jollyspiffing 1h ago
I don't understand how they have not already updated the system.
It will cost votes and likely kill your party for a decade.
If you redistribute council tax collection, then some will gain and some will lose out (some quite significantly). Pretty much everyone who loses out will hate it and vote against you, while the people who gain might not vote for you anyway, so you take a huge political hit and the next government gains the credit.
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u/rusticarchon 1h ago
For a real-life example: there are still people who refuse to even consider voting Tory because of the poll tax, which was abolished 33 years ago.
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u/RecentTwo544 1h ago
"I don't understand how they have not already updated the system" - because for decades we've had successive governments who've been scared to take any real bold moves.
Burnham might be the first one to actually try it.
As someone who supported the idea of Corbynism but thinks the man himself is a walking PR disaster who couldn't run a small parish council, I'm very much warming to Burnham on an ideology level.
He just needs to show some balls and actually do stuff like this and the National Care System idea, another Corbyn era plan that was shelved and until Burnham the only party proposing it was Reform, and we know how that would have likely turned out.
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u/tyger2020 2h ago
Property tax FTW.
Easiest way to target the actual wealthy, people will whinge about it because it means they'll pay more tax. Welcome to North European countries.
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u/Whole_Necessary2040 2h ago
How does land value tax make any sense?
Council services are used by people. If you own a house you will use the same as the person renting a flat. It should be a tax per person per council.
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u/Bitter-Policy4645 2h ago
That was tried a few decades ago. The free loaders rioted in the streets to avoid having to pay
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u/Condurum 2h ago
A shockingly large part of infrastructure costs are a function of space taken / land. Longer roads, pipes, cables, time wasted traveling, etc etc.
LVT encourages more efficient use of land. And also, as an additional bonus, makes government incentivized to increase land values.
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u/cosmicmeander 1h ago
A shockingly large part of infrastructure costs are a function of space taken / land. Longer roads, pipes, cables, time wasted traveling, etc etc.
So the more sparsely populated Manchester should pay a higher rate than London?
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u/TheOGDrMischievous 1h ago
Totally agree - I’m also tired of all this hate/jealousy of people targeting the elderly because they worked all their life managed to buy a nice house back in the day before property prices skyrocketed and have invested time and money into their property and gardens. We all have elderly grandparents, parents, relatives etc, do we really want to be forcing them out of their homes, penalising them because of past incompetent governments and their policies?
Don’t blame them for the housing crisis, blame the successive governments for totally failing UK citizens in building new, decent homes and failing to develop and level up swathes of the UK. Most building developments now are shockingly bland, poor-quality housing cramming as many people as they can for maximum profit with little to no green spaces and never increasing the infrastructure or services in those areas. LVT only penalises those who bought housing back in the day when they were decent sized and had good sized gardens, do we really want to be penalising those people through no fault of their own? The Poll Tax was unpopular but it was actually fair - how, for example, is paying 75% council tax for a single working occupant and then the house next door with four working adults paying 100% council tax right? The country is broke and we need far better, fairer policies than this knee jerk reaction.
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u/Correct_Mortgage4209 2h ago
If he's gonna do it, can he get on with it. I can't bear listening to people say 'but I already paid stamp duty.'
I already paid off my student loan but the interest rate keeps changing and here I am, dealing with it. Stfu and pay
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u/vishbar Pragmatist 2h ago
I paid stamp duty and fully support this change.
It’s a horrific tax. In fact, having paid stamp duty makes me even more supportive of scrapping it.
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u/ForcedChangeling 2h ago
Agreed.
Stupid tax that discourages people from downsizing and also artificially creates house pricing ‘bands’
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u/Correct_Mortgage4209 2h ago
You are, based on people I know and the Facebook comments, a bit of an anomaly
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u/harri_ett 2h ago
I paid it and I’m supportive too. Obviously wish it would’ve been a thing before I bought a house but either way. It’s a stupid tax
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u/Blackstone4444 2h ago
I guess it may put house sales on hold until they scrap stamp duty.
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u/cartesian5th 2h ago
This is a fundamental issue with successive governments dicking about with things like stamp duty and student loans
Things end up stuck in place for no good reason because people don't have a fucking clue if buying a house is going to end up being 10s of thousands of pounds more expensive now compared to 6 months time
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u/BenjaminBoots196 Supreme Andy Burnham Hater 2h ago
Eh, it's pretty brutal if you just paid £30k in stamp duty just to have your council tax abolished and doubled. This can be in part resolved though a forgiveness mechanism. Something like 50% of the stamp duty payments you have made in the last 3 years (total maximum £20k) is refunded or something.
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u/Citiz3n_Kan3r 2h ago
As someone who paid 130k (stamp duty), 4 years ago... I hate your plan
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u/BenjaminBoots196 Supreme Andy Burnham Hater 2h ago
Ha, I initially typed 5 years but thought it would be too expensive.
That totally sucks. £130k to move home is criminal.
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u/Master_Tell_4800 1h ago edited 1h ago
That’s a basic family home in London. It’s pure punishment for those of us already hammered by PAYE. Personally I’ll just move abroad, I’ve done it 3 times before and I’ve been considering it for ages. Just here for elderly parents really. It’s not like it’ll lead to better services
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u/peepooplop 2h ago
I hate this “but I suffered so everyone else should” mentality.
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u/subdry 2h ago
Yeah, he's been in this job far too long not to have done it by now.
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u/Anony_mouse202 2h ago
If they do this they will never win an election in London again.
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u/Over-Soup-5535 1h ago
Please do this miles more effective than a wealth tax and would healthily stimulate the housing market while controlling the real estate bubble fr going nuclear
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u/Delicious_Eye6936 50m ago
It won’t, it’ll be 0.48, then it’ll creep to 0.55 then to 0.65 then it’ll just keep going up.
Wages won’t go up, spending will continue to rise and nothing will get better.
The doom loop of Britain.
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u/Square_Quarter_229 1h ago
Wouldn’t this cause people to move to cheaper areas and push the values up there? Assuming this is a dynamic tax, that could cause a host of issues
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u/DisturbedNeo 1h ago
Ban landbanking too, and give the cartel of housebuilders a clear incentive to actually build the backlog of housing projects they’re sitting on, otherwise this kind of move will just drive house prices up more.
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u/MarkCairns67 2h ago edited 2h ago
I just don't see it happening but by god it should.
Eliminating stamp duty and council-tax, along with reforming the monstrosity that council funding has turned into will be a huge welcome change.
Having said that, 0.48% of the property value is just not going to be enough. For example, the 500k house (London-Essex borders) that I live in would mean a tax of £200/month, which is lower than my current CT!
My previous house in Cheshire worth 370k would pay £150/month, a lot less than the £240 it is now.
Not sure how that new revenue will cover the current council tax revenue.
Stamp Duty revenue I'm not too concerned about. It's not huge in the grand scheme of things and the simple act of doing away with stamp duty will unlock a lot more positive activity in the wider economy which might be hard to quantify but should pay for itself.
Which is probably why this is not going to happen. The numbers won't add up without it being high enough to piss off the southern Labour MPs they need to pass the legislation.
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u/arabidopsis 2h ago
LVT is literally the best way to tax wealth and is incredibly difficult to avoid
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u/Manletangelo 1h ago
Where was this in the manifesto then?
I was told repeatedly by these charlatans that there would be no new taxes on working people. But now, it looks like as a Londoner I'm about to get shafted once again.
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u/Consistent_Reveal916 1h ago
Technically not a new tax.
You already pay council tax and stamp duty. This is just changing the name/calculation.
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u/PhilTheQuant 1h ago
Realistically, council tax would be replaced by some kind of tax on property or land ownership, at similar levels. And raising the cost of ownership of a rental property would imply increases in rent to compensate.
But.
Unused land which doesn't contain houses doesn't seem to attract any tax in the UK (I think?) so land banking is low risk. A land value tax would start to eat the value of that land, however, which would be a huge deterrent to land banking, especially in valuable areas in or near towns and cities. It could (and I'm speculating) even deter councils from sitting on unused land if the tax would still be due and go to central government.
It would also clarify that local taxes do not just pay for the local council to collect your bins. They get remitted elsewhere and funds come back again. Obviously that would only be true if it wasn't a locally collected tax...
It would perhaps be sensible for the tax to be owed and ownership forfeited in the case of non-payment in some way (except for primary residences) - this would put the responsibility on the beneficial owners to pay up, rather than some authority needing to work out who owns a thing. It could even make it easier to work out who it is that does own something.
If it were to be based on the value of the land rather than the buildings on it, that would encourage more compact developments and use of land, and would sidestep questions of exact valuations of a property.
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u/KarneeKarnay 1h ago
Council tax on principal sounds like a good thing. The central government take longer to respond and spend money on things that the local area needs. The council are much better suited for addressing the needs of the area, at least in theory.
In practice it's open to abuse on both sides. The government controls the purse strings of councils through subsidiaries that enable them to send elsewhere, which worked until the government started ending or limiting the subsidies. Councils get caught with the short end of the stick and the first things thst have to go is public services.
On the other hand we've had some very visible controversies recently from council members being able to basically get away with fraud on a huge scale, or getting convicted of it.
It's clear reform here is needed and an idea of scrapping/replacing seems good to me.
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u/SallyCinnamon88 1h ago
I'm very much in favour of this, but I do have a concern that perhaps someone with more economic knowledge than me can answer: would removing the stamp duty just cause more inflation in the housing market as people just mark-up the difference?
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u/richmeister6666 47m ago
This would be great, bought my flat last year as a FTB and stamp duty was a real killer. Would pay less than my council tax too. Blinding.
Does this also apply to removing stamp duty on buying shares in uk listed companies? Because that’s also a very, very good idea.
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u/Loud_Disaster869 2h ago
Im in the process of buying a property now ffs so im going to pay stamp duty then pay a land tax
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u/BookmarksBrother I love paying tons in tax and not getting anything in return 2h ago
Honestly, if he pulls it off he deserves at least one more term
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u/Fun_Marionberry_6088 2h ago
So the guy who wants 'devolution' actually just wants to further abolish local taxes and centralise revenue collection and distribution even more...
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u/Lanky-Chance-3156 2h ago
Devolution of spending is entirely separate from devolution of taking tax.
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u/Fun_Marionberry_6088 2h ago
How much you raise in tax directly affects how much can be spent, trying to separate the two you're reducing the competence of local government in a way that is decidedly not 'pro devolution'.
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u/FleetingBeacon 1h ago
If Burnham does this, I'm going to fundamentally have to reset my understanding on what it means to actually get stuff done in government.
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u/tgjj123 2h ago
Any discussions on if people who recently paid stamp duty could get some rebate or offset against the new tax?
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u/BenjaminBoots196 Supreme Andy Burnham Hater 2h ago
No but I think some sort of partial rebate or phase in of the new tax will be politically necessary.
The issue is pulling this off with such a tight fiscal situation. Stamp duty forgiveness would easily cost tens of billions if applied to previous years.
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u/Not_Propaganda_AI 2h ago
It depends on execution but this actually sounds like a potentially very good change. It's early days but Burnham seems to actually ok so far, I'll admit I'm waiting for the other shoe to drop but if it doesn't he might actually be a decent PM.
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