Members of the public in certain areas will ‘suffer’ more than others under a major tax change being weighed up by Burnham
Andy Burnham could increase the scope of the Mansion Tax (file) (Image: Getty)
A new map has highlighted the areas that will suffer most of all should Andy Burnham make sweeping tax changes. The Member of Parliament for Makerfield is the odds-on favourite to replace Sir Keir Starmer as Prime Minister. It is believed that the ex-Mayor of Greater Manchester will make sweeping changes to property tax which, according to a newly released map, will affect those living in the capital most of all.
A Mansion Tax introduced last year as part of Chancellor Rachel Reeves‘ budget meant extra charges for those in homes worth £2million or more. Andy Burnham may lower the threshold to £1.5m. Should such a change come through it would affect homeowners across the south of England.
London will face the largest proportion of price hikes should the Mansion Tax adjustment come through, per Tax Policy Associates. Those living in Battersea, Kensington and Bayswater, and Hammersmith and Fulham are most likely to be affected. Camden, Barnet, and Ealing are also tipped for major changes.
The South East of England is the second place to London, with Surrey and Hampshire set to be the hardest hit in that area. Windsor and Newbury are also listed as places where the tax would hit homeowners the hardest.
Hertfordshire and Trafford were also featured on the list of places outside of London and the South East of England where the Mansion Tax change could affect homeowners.
Reeves implemented the Mansion Tax last year (Image: Tax Policy)
The Tax Policy Associates team wrote: “Our estimate: a £1.5m threshold would tax around 150,000 additional homes, almost doubling the number of properties in scope. But simply adding a lower band would not raise a great deal of extra money.
“To get close to doubling the yield, the tax would have to become more aggressive, with £1.5m homes paying the current lowest charge of £2,500, and the charges for the existing £2m-plus bands all being pushed upwards.
“On that basis, the net revenue could rise to about £800m a year – so Mr Burnham may regard this option as tempting. There is, however, a serious downside: tax systems need stability. Expanding a tax before it’s even been introduced is, in our view, the opposite of stability.”