Andrew Dixon, our campaign’s Founder and Chairman wrote to Prime Minister, Boris Johnson last week, warning that the ‘levelling up’ agenda would be under threat if we continue on with our broken and unfair system of property tax. You can read more about the letter here.
Dear Prime Minister,
I am writing to you in my capacity as Founder of Fairer Share, a grassroots initiative campaigning to abolish Council Tax and Stamp Duty, replacing both with the Proportional Property Tax.
As Prime Minister, you have rightly made ‘levelling up’ one of your Government’s key ambitions. This is a plan I wholeheartedly support, and it is why I am writing to you today.
Over the last 30 years, we have witnessed rising inequality levels – both on a regional and an intergenerational basis. Sadly, COVID-19 has hit the poorest the hardest, particularly those in low-income, insecure work, and it has compounded, deepened, and underlined those prevalent inequalities.
The agenda you have set to level up is essential as our economy recovers. I firmly believe that we cannot level up our country without scrapping and replacing both Council Tax and Stamp Duty – two taxes that continue to exacerbate rather than ease these inequalities.
Today, I urge you to replace these regressive and destructive taxes as a central pillar of your levelling up plan.
Council Tax is an outdated and unfit system. It is based on property values made in 1991 and has led to low-income households paying a tax rate five to ten times higher than those fortunate enough to live in million-pound properties.
It is a regressive form of tax and disproportionately impacts struggling communities – the same communities your Government is aspiring to support. Evidence shows that the ‘red wall’ constituencies face “The Burden of Council Tax” that is nearly 80% higher than the national average.
The average household in England pays 0.47% of their home’s value per year, yet in many communities across the North and the Midlands, households pay a considerably higher rate, going up to 1.41%, with Easington in County Durham paying the highest rate. By comparison, the Cities of London and Westminster has an average rate of 0.06%. This system is fundamentally broken.
Meanwhile, Stamp Duty hinders aspiration and mobility, fuels intergenerational inequality and adversely impacts the broader economy. We need to find a solution to the well-intentioned Stamp Duty holiday.
Levelling up cannot be achieved solely through infrastructure spending pledges and Government cash. To help turn the tide, scrapping Council Tax and Stamp Duty would have a most significant impact on hard-working families and pensioners across the UK.
The simple Proportional Property Tax set at a flat rate of 0.48% of a property’s value would bring in the same amount of revenue as Stamp Duty and Council Tax combined. Our analysis shows that 19 million households in England would be better off, on average saving £435 each year. We also found that in the 44 ‘red wall’ constituencies that your Government won in the 2019 General Election, 97% of households would save £660 each year.
We all want to live in a fair society but it does not seem right that a household in Barnsley pays 1% of the property value in tax whereas a household in Battersea pays just 0.1%. Council Tax has become a troubling wealth tax for middle and low-income households, and is a modest service charge for the wealthy.
I urge you and the Chancellor to use tomorrow’s budget to authorise a review of the country’s residential property taxes. I recommend the Government examine this issue through the lens of fairness, economic activity, social mobility, the Government’s levelling up agenda, and the impact of the pandemic on household and local Government finances.
There may never be a better time to reform this system – and I encourage you to be the Prime Minister to deliver this change and help us all to build back better.
Yours sincerely,
Andrew Dixon
Chairman
Fairer Share