A council tax hike for expensive foreign-owned properties could raise millions according to a group of experts.
The Northern Powerhouse Partnership (NPP) is calling for council tax bands in England to be changed dramatically to raise millions for councils bereft of funding.
In a letter to Chancellor Jeremy Hunt, they said they wanted him to completely reevaluate the council tax bands in his Spring Budget in March. As part of their proposed overhaul, the NPP said there should be higher tax bands for expensive foreign-owned properties.
The group said this would help level the playing field between poor and rich councils and update council tax bands that have not been changed for over 30 years in England with tax bands based on the value of a property in 1991.
Speaking to the BBC, the NPP’s Chief Executive Henri Murison said that while fixing the problem would “take a long time” the system needs to be fairer.
He explained: “At the moment you could be living in a house worth twice as much, just down the road from someone and be paying less council tax.
“And that’s not really fair on the person down the road, is it? And that could be solved relatively easily and quickly as long as the revaluation work had been done.”
Mr Murison isn’t the only person who thinks council tax needs changing, Conservative Lord Eric Pickles said the system should be reformed and it was an issue governments had avoided.
However, Lord Pickles warned it was “physically impossible” for the system to be changed before the next general election and that the changes would be for the next government to instigate after they had taken power.
The NPP’s suggestions come as new analysis predicts that council tax will rise faster than inflation for most homes in England in April. Conducted by the Telegraph, it shows that taxpayers will once again pay more tax during a cost of living crisis.
Head of campaigns at the Taxpayer’s Alliance Elliot Keck, told the publication: “It’s an unhappy new year for local taxpayers who face yet another round of damaging council tax hikes.
“Councils that have yet to declare tax rates for the upcoming year should seriously reflect on whether it’s fair to ask households to cough up yet again.”
In a statement on whether there would be reforms, a spokesperson for the Levelling Up Department said there were no plans “to conduct a nationwide revaluation of council tax bands” and that councils were “ultimately responsible for their own finances and for setting their own council tax”.
