Andy Burnham weighs sweeping reforms to UK property taxation

The mayor of Greater Manchester is pushing for a comprehensive overhaul of England’s property tax regime to generate money for social-care reform and increased defence outlays. Proposals range from a land-value tax set at 1.28% of assessed value, which would replace council tax and residential stamp duty, to a flat-rate proportional tax of 0.48% that could be doubled for second homes. A third idea would scrap the principal-residence exemption on capital gains, taxing gains on any sale.

Implementing any of these schemes would require a massive revaluation of homes, a task the Valuation Office hopes to accelerate with artificial-intelligence tools. While a land tax could discourage land banking and provide a stable revenue stream, economists note it may initially cut government income and raise bills for high-value properties, especially in London and the south-east. Older homeowners with large estates could face affordability issues, though some suggest deferring payments until a sale. Political support appears split, with the Greens and Liberal Democrats open to a land tax, while concerns linger about alienating older voters who hold most housing equity.