Andy Burnham’s first months in office are set to revolve around Burnham council tax and a broader fight over how to raise money, with advisers saying he has little choice but to look at higher taxes. Dan Neidle’s discussion paper sets out a land value tax at 1.28% that would replace council tax and stamp duty.
Phillip Inman wrote that “The professional classes act like a Praetorian Guard for the super-rich.” His case is that Burnham cannot fund his plans by borrowing more, so the tax question lands early and sharply.
Dan Neidle’s 1.28% scheme
The Neidle scheme would raise £56.7bn by replacing £45.2bn from council tax and £11.5bn from stamp duty. The proposal uses a flat charge on land value rather than on the buildings on it, so the tax falls on the site itself instead of the property above it.
That structure is the point of the scheme. Land cannot be shifted overseas, which is why the proposal is presented as easier to collect than taxes that depend on income, transactions or movable assets.
Who pays less under Neidle
About 70% of homes would pay less than they do under current council tax under the Neidle calculation. The homes that gain are mostly outside London and the south-east, where property values are lower relative to the tax they already pay.
The practical effect is a transfer in the burden of property taxation away from many ordinary homeowners and toward land with higher value. For a household, the immediate question is whether its current council tax bill would sit above or below the amount generated by a 1.28% land charge.
Burnham and the tax fight
The article says Burnham’s opening months will be a battleground over raising funds, because advisers have limited room to borrow and are left with tax as the main route. It also says taxing the rich would fit with his pledge to be “more Labour”.
The complication is political rather than technical. The piece argues that the current tax system is full of distortions, yet it also says the professional classes are a powerful lobby against reform, which is why a land value tax can be designed on paper and still be hard to deliver in office.
Whether Burnham will actually adopt a land value tax is not answered, but the direction of travel is clear: the first months in office are likely to test whether he is willing to push through a replacement for two big property taxes that would leave most homes paying less.
