Letter: Revaluation of Properties Urgently Required for Fairer Local Taxaxation

Published on: 8 Aug, 2023
Updated on: 7 Aug, 2023

From: David Roberts

In response to: If Councils Had the Power to Raise Local Taxes…

In case anyone has been asleep for the last 15 years, big government is back. The financial crash, Brexit, Covid, an ageing population and climate change all mean that public revenue is far too low to meet public expectations.

These now include a whole range of benefits never before imagined, including furlough compensation, energy subsidies, help for homebuyers, free care for the elderly and even scrappage payments for dirty vehicles.

Like it or not, taxes are going to have to rise a lot to pay for all this, whoever raises them. But, since income levels have widened, the better-off can well afford them. So the main challenge is fair burden-sharing.

My top proposal would be to update property valuations for council tax purposes (repeatedly postponed since 1991) and add a few more top bands to the ones that exist now. It’s ludicrous that the top band starts at a 1991 value of only £320,001, equivalent today to £912,000, which in Guildford would barely buy you an ordinary 4-bed house, although in practice Band H seems to cut in at a slightly higher level than this.

Why no Bands I, J and K? Why should a £2-million (or £20-million!) mansion not pay far more tax? Would anyone really suffer if it did? And why after 13 years has this government not allowed councils to raise extra millions in this way?

Responses to Letter: Revaluation of Properties Urgently Required for Fairer Local Taxaxation

Jim Allen Reply

August 8, 2023 at 9:06 am

I brought a home in 2004 no one wanted as it was in effect a derelict!

Why should I pay tax on my own very hard work to improve it?

My income hasn’t risen like the value of my home! Which has risen two fold by general house price rise, and because it is now fully habitable!

Pay for services used not double tax people on their own hard work!

Name and address hidden please!
Brian Creese Reply

August 8, 2023 at 10:12 am

David Roberts’ suggestions here are modest but make a great deal of sense. House ownership has become a means of hoarding wealth rather than having a place to live and the failure of all governments to revalue properties for over 30 years is a disgrace. This would be a small measure to rebalance wealth inequality and as such would be a welcome start in taking this country back to being a more equal – and equitable – society.

Brian Creese is a former chair of Guildford Labour
- Martin Elliott Reply
  
  August 8, 2023 at 10:16 pm
  
  Politic posturing isn’t a solution to taxation.
  
  The ranking of houses by value or rentable value as previously, is just that, a ranking exercise.
  
  As long as a known timeline is used the only variation is if individual property values are changed by improvements thus moving them to a higher band.
  
  It’s the precept set for each band that sets the actual tax and is adjusted to raise the allowed budget.
  
  Maybe Brian Creese has a point that more bands are required for more valuable properties, but I’m not sure as a ranking exercise will cause a massive change in revenues collected by local authorities.
John Perkins Reply

August 9, 2023 at 12:04 pm

There is no reason to believe that council tax bands should be increased in line with house prices. What could it achieve? Milking people for more money assumes that they have it in the first place. There is no limit to ever-increasing public expectations, but there is a limit to the public’s ability to pay for them.

More tax bands would simply result in a return to the situation that existed in the 1980s. Margaret Thatcher attempted to correct the unfairness inherent in that system, leading to her downfall and riots in the streets by those who would be required to pay their fair share by being taxed for the first time. The current system is a poor compromise which was wrong at the time and is wrong now.

Most people buy a house as a secure home to live in, and move because they want somewhere better or need somewhere bigger, usually to raise a family. Whilst they are happy to enjoy the illusion of an increase in their wealth due to the house they own, it is not their primary motivation in buying it. House prices are outside of their control.

The very wealthy will always be different as they can always choose whether or not to pay.
Mark Stamp Reply

August 9, 2023 at 2:55 pm

David Roberts mentions that one drain on public finances is homebuyer support. For me, one of the reasons not talked about is an aging population staying in larger houses blocking the top of the ladder. Increasing property taxes might go some way incentivising people to downsize once they have an empty nest.