I tabled a motion at the full meeting of Durham County Council held on Wednesday 8 December 2021 asking the council to acknowledge that the current council tax system is unfair and to consider the benefits that a replacement proportional property tax would bring to our residents.
With characteristic swagger the Tory-led coalition ‘amended’ the motion, meaning that they can claim control of the motion and assume the right to deal with it as they wish.
The concern is that the Tories, leading the Lib Dems in coalition in county hall, will now discard any reference to a proportional property tax and attempt to give the impression that seeking to reform the council tax regime will have a similar effect in reducing bills. However, in reality we know that the Tories will never adopt a proportional property tax because whilst it would benefit our residents in County Durham and other working-class areas across the North it would be more costly to their voters in the prosperous Tory heartlands of South-East England.
However, Labour members will make sure that the Tories deliver on the motion’s promise to carry out a review into the council tax system and how it places a disproportionate burden on those least able to pay. We’ll then use every opportunity to press the coalition into supporting a proportional property tax - a fairer system that would reap benefits for the majority of residents in County Durham and beyond.
I’ve published below the text of my motion and the rationale I used in introducing my motion to the council meeting:
Proposal: The current Council Tax system is outdated, unfair and no longer fit for purpose. Therefore, this council agrees to pursue every available opportunity – including the involvement of appropriate government departments and other agencies as necessary – to consider the benefits and feasibility of adopting a fairer system in the form of a Proportional Property Tax
Whenever it crops up in conversation it’s almost universally accepted that the current Council Tax system is outdated and unfair – especially to those people living in towns and villages like our own in County Durham where the burden of Council Tax falls disproportionately on young people, on low-earners and on those struggling to get by.
Successive governments have had 30 years to reform the CT system but none have taken that opportunity, suggesting that the entire system is beyond reform and in need of replacement by a fairer, more equitable system.
That leaves us with just two main options: we either plough on regardless, doing nothing until the system reaches breaking point. Or we seek to find a better, fairer way of doing things.
The first option of course won’t benefit anyone, so I suggest that we need to take a closer look at the benefits of a Proportional Property Tax – a fairer system that relieves the hardest hit of the heaviest burden, reduces housing market inequalities, frees-up homes to those who need them most and a system that actually puts money into people’s pockets and kick-starts our local economies. Something that is so badly needed in our area where the Northern Powerhouse has failed and the government’s ‘levelling-up’ agenda is revealed to be nothing more than empty rhetoric.
Without wishing to go into detail at this stage we could focus instead on the core principles of a Proportional Property Tax and also take a closer look at the main benefits – all well-researched and fully costed (these have been provided by the Fairer Share campaign - details in the link at the bottom of this page):
Principles include the notion:
Property taxation should be based on actual property wealth: the burden should be shared proportionately
Property taxation should be simple to understand, easy to administer and hard to avoid
Property taxation should be fair, with wealthier regions supporting other areas
Property taxation should relate to a household’s ability to pay and
Property taxation should encourage the most efficient use of land and buildings
Benefits nationally include:
18m households would be better off, with 75% paying less tax
£6.5bn would be saved by council tax payers outside London, representing a huge boost to our local communities and economies
8.7m households would be taken out of property tax entirely because the obligation to pay falls to the landlord rather than the tenant
Each year 750k house buyers would no longer have to pay Stamp Duty, making house buying simpler and cheaper
An increase in GDP of over £3bn a year from increased housing market activity and
600k homes over 5 years would be released, freeing up homes for younger people and those who need them most
If we can accept those principles at this stage, and agree that the benefits of a fairer system outweigh the current burden of the Council Tax and Stamp Duty regime we can then as an authority work together with any external agency necessary to make change happen for the benefit of our local councils and their communities – and more importantly for the benefit of the residents of County Durham and elsewhere who deserve a better, fairer system after decades of bearing a disproportionate tax burden.
Cllr Rob Crute
Blackhall Division
Durham County Council
For details about the campaign for a Proportional Property Tax please go to the Fairer Share manifesto page at:
https://fairershare.org.uk/wp-content/uploads/2021/10/Fairer-Share_Manifesto.pdf