Property taxes: a new broom?

One of the biggest bugbears for any homeowner is budgeting not only for a maintenance programme to avoid more expensive remedies later, but also for the ongoing amounts required to be paid to the authorities each month in the form of council tax. And it's especially acute when you feel you aren't getting much of a council service for the amount you're forced to fork out.

There have also been questions raised about the fairness of the stamp duty land tax (in England) and the land transaction tax (in Wales) when you're buying a property. This is because those buying properties in the less affluent areas of the country, especially northern counties and south western parts of England, in addition to parts of Wales, are proportionally paying more than those from the more affluent areas, primarily the south eastern corner of England, London and the home counties.

Part of Labour's election manifesto for the 2024 General Election highlighted plans to revisit and overhaul many aspects of the homebuying process with a view to making it far slicker, quicker and much cheaper.

As of 20 July, we have a new Prime Minister, the former Mayor of Greater Manchester and now MP for Makerfield. Having had significant success up north in his mayoral position, Andy Burnham now wants to improve equality and fairness across the whole country rather than sticking with the perceived focus on London and its Home Counties.

Some of that is visible in newsworthy activities such as the creation of the "Number Ten in the North", replete with a shiny black door and the familiar off-kilter "10" on the front.

Burnham is supportive of a petition that has been raised to look at the council tax numbers, suggesting that a fairer method would be to set a level based on current house value. Note that the current bandings are based on a swift valuation at the point the tax was introduced in the nineties. This would allow for fluctuations in demand for properties and the vagaries of supply and demand in the local housing market.

One of the criticisms of this approach is that it then looks like the richer areas will essentially be subbing the poorer homeowners, the "why should a homeowner in Tonbridge be covering the cost of a library in Solihull" argument, particularly when council tax as it currently stands is intended for local services and requirements.

But while the social support aspect of the idea is an ideal and will help the country as a whole, Burnham has a couple of problems to face if he wants to adopt some of these ideas to rationalise council tax nationally. The first is that he has stated he will conform to the tenets of the 2024 Labour Manifesto as the new Prime Minister. The second is that sorting out the inequities of council tax wasn't one of the items within it.

The British democratic process dictates that people vote for a party, which then elects a leader, although of course the leader at the time of the election usually has an impact on the choice of party voted for. Therefore, when a Prime Minister resigns, it's the party that elects the next leader through a lengthy and detailed process. It doesn't mean a new leader requires another General Election.

However, what the process does mean is that voters have not given Burnham a mandate to do anything with council tax. To do otherwise will frustrate the process and potentially result in resistance to anything not in the original manifesto.

So the petition is the only formal way for the public to raise the issue. If sufficient people sign up to the petition, it necessarily has to be discussed within the House of Commons. This takes time, and those seeking change will no doubt be frustrated.

But even if Burnham decides to go ahead and force a change in the process, there will still be major problems facing him. In order to move the necessary changes into being, there will need to be much discussion at all levels to make sure that whatever replaces or overhauls the council tax process is at least better than the process currently in place, and most importantly, that it's fairer than the current taxation system.

The problem is that time is against the current government. There is such a change required to make this work that most experts believe it will not be effective within the time left to the current Parliament before the country goes back to the polls in 2029.

Whether the fresh energy Burnham seems to be bringing to the Prime Ministerial role in the first few days of his premiership results in significant changes for homebuyers and homeowners remains to be seen, but Homeward Legal will be watching and reporting on any progress.

However you're approaching your property project, you'll need effective and focused legal representation to ensure the legal side of things is handled as quickly and efficiently as possible, with the experience and knowledge that protects you throughout the transaction. This is why you should talk to Homeward Legal as soon as possible to get your transaction moving effectively.

Our conveyancers at Homeward Legal will start work on your plans as soon as you agree to the quotation and appoint them to represent you. Call us now on to get your conveyancing quote started, or use our quote generator.