Fairer Share’s Founder, Andrew Dixon, speaks about why Council Tax, Stamp Duty Land Tax and Inheritance Tax need to be scrapped in favour of a fairer, growth-friendly Proportional Property Tax.

Britain’s tax system is no longer fit for purpose. It is overly complex, economically distortive, and increasingly unfair across generations. Three taxes in particular capture the problem. These are Council Tax, Stamp Duty Land Tax (SDLT), and Inheritance Tax (IHT).

Together, they raise roughly £55 billion a year, yet do so in ways that penalise aspiration, entrench inequality, and hold back economic dynamism.

Replacing them with a single Proportional Property Tax would not just be a reform of property taxation. It would be a fundamental reset of how the UK taxes wealth, mobility, and intergenerational transfers, bringing Britain closer to international best practice.

Start with Council Tax, which raises around £45 billion annually. It is one of the most regressive taxes in the UK. Households in lower-value properties can face effective tax rates several times higher than those in high-value homes, largely because the system is still based on 1991 valuations.

In a country where house prices have diverged dramatically across regions, this is increasingly indefensible. Most advanced economies have long since moved to regular revaluations or proportional systems to avoid precisely these distortions.

Stamp Duty Land Tax raises around £10 billion annually but at significant economic cost. It is a textbook example of a “bad tax”: one that changes behaviour in damaging ways. By taxing transactions rather than ownership, it acts as a direct barrier to moving home.

OECD evidence shows that transaction taxes reduce housing turnover and labour mobility, weakening productivity. The UK’s reliance on SDLT helps explain why people move less often than in comparable economies, locking families into unsuitable homes and constraining access to opportunity.

Inheritance Tax raises just £8 billion a year (that’s less than 1% of total tax revenue) yet generates disproportionate public hostility. It is widely perceived as unfair, not least because it taxes assets built from already-taxed income. In practice, it is also highly avoidable for the wealthiest, while falling more heavily on those without access to complex planning.

At the same time, it fails in its broader purpose: wealth is typically passed on too late to make a meaningful difference. The average inheritance is received at around age 60, decades after it could have helped with housing,
education, or starting a business.

Taken together, these taxes are not just unpopular. They are economically counterproductive and increasingly out of step with international evidence.

Across the OECD, recurrent annual taxes based on up-to-date values on property are widely
regarded as among the least harmful to growth. They are difficult to avoid, stable, and do not discourage work or mobility.

That is why institutions such as the OECD and IMF have consistently argued for shifting the tax mix away from transactions and towards property-based taxes.

The UK is an outlier. It relies heavily on inefficient transaction taxes, while its main annual property tax is based on valuations from over three decades ago.

A Proportional Property Tax would correct this. Instead of outdated bands, transaction penalties, and end-of-life levies, it would apply a simple annual charge of around 0.5–1% of property
value based on current valuations. This could raise similar or greater revenue, while distributing the burden far more fairly.

Crucially, it would allow for the abolition of Council Tax, SDLT and IHT altogether.

Scrapping Council Tax would end a system that penalises people for living in modest homes, replacing it with a fairer model where contributions reflect actual property values, not outdated estimates from 1991.

Removing SDLT would immediately reduce the cost of moving, often by tens of thousands of pounds, unlocking housing transactions and improving labour mobility. International evidence suggests that cutting transaction taxes can increase mobility by double-digit percentages, with clear benefits for productivity and growth.

Replacing IHT with an annual, unavoidable property-based charge would broaden the tax base and reduce avoidance. Property is immovable and visible. Unlike other assets, you cannot hide it offshore, making it one of
the most efficient tax bases available. This would reduce reliance on complex tax planning and ensure that contributions are based on real, observable wealth.

For younger generations, the benefits would be transformative. Today’s system imposes high upfront costs, delays wealth transfers, and restricts housing supply. A proportional system would encourage downsizing and more efficient use of housing, freeing up homes for younger families.

It would also support earlier transfers of wealth when they matter most, in people’s 20s and 30s, not their 60s.

There is also a compelling political case. Council Tax, SDLT, and IHT are all deeply unpopular. Few voters would design such a system from scratch. Replacing them with a single, transparent tax would represent a major simplification, reducing administrative costs, increasing transparency, and rebuilding trust.

For political parties, this is a rare opportunity to deliver a triple dividend: stronger growth, greater fairness, and a simpler tax system aligned with global best practice.

Finally, there is a practical reality for households. The future of IHT is uncertain. Frozen thresholds are already pulling more estates into scope, and future governments may tighten the regime further.

Against that backdrop, there is a clear case for passing on assets sooner rather than later, rather than relying on a system that may become more punitive.

The UK does not need incremental tweaks. It needs a fundamental reset. A Proportional Property Tax offers a clear path to a fairer, simpler, and more growth-friendly system.

Sign the petition to call for a full and independent review of the UK’s property tax system.