Editor's note: This brief was summarised by The Property AI Newsroom from a report by Property Industry Eye. Read the original article for full details.
Burnham-Backed Property Tax Reform Reported
Several reports over the weekend have highlighted potential housing policy changes that could be pursued by Andy Burnham if he becomes prime minister. These reports claim Burnham supports replacing council tax and stamp duty with a new annual property levy.
According to the reports, Burnham is said to back the proportional property tax (PPT) proposed by the Fairer Share campaign. This scheme would replace both council tax and stamp duty with an annual levy based on 0.48% of a property’s value. For second homes, empty properties, and homes owned by overseas buyers, the rate would rise to 0.96%.
Analysis from the Fairer Share campaign suggests the impact of the proposed tax would vary by location. In London, a majority of households would pay less in four boroughs: Barking and Dagenham (58%), Islington (52%), Southwark (52%), and Hackney (51%). In Croydon, half of households would see lower bills. Conversely, Westminster would be the hardest-hit borough, with only 12% of households estimated to pay less and 88% facing higher property taxes, though many would see relatively modest increases.
The proposal would make property owners, not tenants, liable for the tax. However, there is concern that landlords could seek to recover some or all of the additional cost through higher rents. For existing homeowners, reports state that any increase in property tax would initially be capped at £1,200 a year. This cap would be removed once a property is sold, after which the full annual charge would apply.
The Fairer Share campaign estimates that the owner of a £700,000 property would pay £3,360 in PPT, which is around the same level as current council tax for a property of that value.
Source: Property Industry Eye