Page 2 | To think an annual property tax is incredibly unfair?

Itchthescratch · 2026-07-01T09:06:01+00:00

I come from an area with low house prices. It is great! My friends can generally afford houses even with lower salaries as the earnings:house prices ratio is better. Rents are also lower so they have proportionately more disposable income. I have moved to a more expensive area where house prices are higher and people have really had to push themselves to buy a property. Salaries are higher but not high enough to make up the difference. They have had to pay more stamp duty , pay more interest and have less disposable income each month. I am really struggling to understand why my friends in the South should also automatically be paying more property tax under the new proposals being suggested by Burnham supporters? What is the justification? They would love to buy a large detached house for £300k like my friends from home but this isn't possible. It feels like they are being double penalised. Just to add house prices haven't risen in real terms in the area in live in now for 20 years so the value of my friend's houses is simply money they have paid in.

Original poster

Itchthescratch · 07/07/2026 13:05

Bellic · 07/07/2026 12:23

A house is indeed an asset and assets held ought to be taxed more.

OP’s issue is that the government’s proposed tax does not count the liabilities held against that asset (I.e. a mortgage) and this does particularly affect the young.

OPs other issue is that had they known of this tax earlier they may have made different decisions.

The first issue isn’t going to be addressed. It would be too complicated and too easily gamed. The second issue is just a fact of life when it comes to tax policy. See also vat on private schools. Its why it’s good not to change tax policy too often. It’s worth it for the government if the resulting policies are far fairer for the tax payer in the long term.

It isn't fairer for the taxpayer in the long term though for the reasons you outlined in the post and:

redistribution of local funds nationally to fund local services run by local councils would be a case of taxation without representation. Those paying the tax have absolutely no say in how the money is spent as they don't get to vote in these areas elections. This is fundamentally undemocratic.
To tax primary residences as if they are an investment represents a significant change of approach and absolutely should be put to the people. The 2024 manifesto promised not to tax working people, yet we know that working people will be disproportionately impacted by this. The Labour government does not have a democratic mandate to start making such major changes only two years since they were elected. This sets a terrifying precedent that anyone who cares about democracy should be against.
the policy basically exempts private renters and SH renters from paying for the local services they use and in the case of SH tenants are more likely to use more expensive local services. We know that there are over 100,000 households in the UK that enjoy subsidised SH and will now be completely exempt from paying for local services whilst the rest of us pay their share. This isn't fair!
this isn't a wealth tax if it isn't looking at actual wealth or even income. It's looking narrowly at one asset, ignoring the fact that many people are highly leveraged and pretending that this is a shortcut to determining wealth. It's bonkers. Property isn't even the biggest source of private wealth for people. Why is the state turning a blind eye to investments and more importantly pensions?.
Areas with lower house prices benefit from this when it comes to affordability and the subsequent quality of life. The earnings to house value ratio is better in lots of areas and this leads to more disposable income and more people being able to get on to the housing ladder. Why doesn't the government see those who live in high priced areas are often already stretched trying to fund housing and don't then want to be hit again with a property tax when they already have paid huge amounts of stamp duty and huge mortgage payments.

OP posts:

Zzam · 07/07/2026 12:48

If you put VAT on private schools why not on university tuition fees as well.

EasternStandard · 07/07/2026 12:26

It doesn’t matter if mn posters get excited by the thought of taxing 1%, there’s posters who want higher taxes at the rate Labour do, or higher even. It is what McFadden meant about every Labour meeting.

Even Burnham will know the backlash of that, if he doesn’t then it’ll become fairly evident quickly.

Bellic · 07/07/2026 12:23

A house is indeed an asset and assets held ought to be taxed more.

OP’s issue is that the government’s proposed tax does not count the liabilities held against that asset (I.e. a mortgage) and this does particularly affect the young.

OPs other issue is that had they known of this tax earlier they may have made different decisions.

The first issue isn’t going to be addressed. It would be too complicated and too easily gamed. The second issue is just a fact of life when it comes to tax policy. See also vat on private schools. Its why it’s good not to change tax policy too often. It’s worth it for the government if the resulting policies are far fairer for the tax payer in the long term.

Zzam · 07/07/2026 12:02

When your home increases in value, you gain home equity.

GasPanic · 07/07/2026 12:01

LipglossAndLies · 07/07/2026 11:53

Because you can't capitalise on the wealth of the home until you sell it. People prefer owning a home because you are typically ending up mortgage free which makes retirement easier to plan for. It provides you more financial freedom to make choices like poor health drop your hour's or if you had to stop working you don't have huge pressure to keep that roof over your head.

Show quote history

"Because you can't capitalise on the wealth of the home until you sell it."

Yes you can. You can part sell assets just as you can part own them.

LipglossAndLies · 07/07/2026 11:58

tripleginandtonic · 07/07/2026 11:33

Would you still have single person discount?

No

LipglossAndLies · 07/07/2026 11:57

BIossomtoes · 07/07/2026 11:24

A house owned outright is an asset. It’s irrelevant whether or not the motivation for its purchase is investment. It can be sold for money and is treated as an asset for inheritance tax purposes.

Well yes because at that point the person is dead and doesn't need a home. 🙄

LipglossAndLies · 07/07/2026 11:53

BIossomtoes · 07/07/2026 08:42

If it’s not an asset why would you buy a house rather than rent? And why is renting often referred to as “money down the drain”?

Because you can't capitalise on the wealth of the home until you sell it. People prefer owning a home because you are typically ending up mortgage free which makes retirement easier to plan for. It provides you more financial freedom to make choices like poor health drop your hour's or if you had to stop working you don't have huge pressure to keep that roof over your head.

smallglassbottle · 07/07/2026 11:42

BIossomtoes · 07/07/2026 11:24

A house owned outright is an asset. It’s irrelevant whether or not the motivation for its purchase is investment. It can be sold for money and is treated as an asset for inheritance tax purposes.

Not if you're living in it. It might become an asset at some point in the future if it needs to be sold, but people need a place to live. You could argue that a car is an asset, but if you need it to get to work or care for a sick relative then you can't just sell it.

tripleginandtonic · 07/07/2026 11:33

Would you still have single person discount?

BIossomtoes · 07/07/2026 11:24

A house owned outright is an asset. It’s irrelevant whether or not the motivation for its purchase is investment. It can be sold for money and is treated as an asset for inheritance tax purposes.

Original poster

Itchthescratch · 07/07/2026 11:16

BIossomtoes · 07/07/2026 10:17

I think you’ll find most people do view their house as an asset. Particularly people who have paid off their mortgages - that’s the majority, by the way. 55% of residential properties in private ownership are mortgage free.

They don't view it as an asset in the way investors typically view investment assets. It is fundamentally for most people a home first and is arguably more of a consumption good than an asset. Surveys consistently show that the majority of people buy their homes for reasons other than wealth building or investment. You insisting otherwise is just inconsistent with the available data.

The extent a house is an asset is also the extent to which it isn't a liability. Mortgages, maintenance costs etc are all ongoing liabilities. Even if you have paid your mortgage off, this doesn't mean owning your home is a fantastic asset. It's illiquid and currently offering a terrible return on all the equity invested in it. You could sell up, rent and put all your money in the bank and make 5% per annum doing nothing. Oh and you also wouldn't be subject to this stupid property tax.

It is a nonsense to treat homes like other investment assets. The government traditionally recognised this and it's why we don't pay CGT on the sale of our own homes.

OP posts:

BIossomtoes · 07/07/2026 10:17

I think you’ll find most people do view their house as an asset. Particularly people who have paid off their mortgages - that’s the majority, by the way. 55% of residential properties in private ownership are mortgage free.

Original poster

Itchthescratch · 07/07/2026 10:07

BIossomtoes · 07/07/2026 08:42

If it’s not an asset why would you buy a house rather than rent? And why is renting often referred to as “money down the drain”?

Have you ever rented? If you have then you would understand why people buy. I have rented a lot in my life and it was absolutely the right thing to do at the time and wasn't money down the drain. It can feel like money down the drain when rent is more expensive than a mortgage would be and you aren't actually paying off your house but it's definitely horses for courses. For me though, owning would have been more expensive as I was moving around a lot and didn't want to commit to one area.

The point is though that unless you have a SH lifetime tenancy then you can basically lose your home at anytime. People tend to want security and stability as they age, especially if you are trying to raise a family. People want to own the roof over their heads. Most people don't view their house as an asset. Do you actually speak to your friends and family about this? Very few people view their homes as some investment opportunity.

OP posts:

EasternStandard · 07/07/2026 09:08

Zzam · 07/07/2026 08:50

When our house value went up we could use it to borrow against

People have affordability criteria.

MaturingCheeseball · 07/07/2026 08:56

Hooting at “driving growth” : these increases would result in fewer meals out, fewer holidays, fewer car purchases.. and as for home improvements - no fear! You would be in danger of increasing what you have to pay!

Zzam · 07/07/2026 08:50

When our house value went up we could use it to borrow against

BIossomtoes · 07/07/2026 08:42

If it’s not an asset why would you buy a house rather than rent? And why is renting often referred to as “money down the drain”?

LipglossAndLies · 07/07/2026 08:14

Peony1985 · 07/07/2026 04:57

You are buying an expensive house that is an asset though. Your shortage of disposable income now is still an investment in your future.
It’s less unfair than a blanket tax on say petrol, where rural people need to run a car and buy fuel. That money has gone.

Show quote history

People are buying a home, to live in because we all need a roof over our heads. Its not an asset, you cannot take the money from it if it goes up unless you sell and move somewhere cheaper.

Owning a second property would be an asset.

We need ro move away from this idea of your primary residence being an asset and making you money. By the time you come to sell you could find yourself in negative equity.

Peony1985 · 07/07/2026 04:57

Itchthescratch · 01/07/2026 10:24

Ok well I have less wealth than my Northern friends because I have a huge mortgage and less equity than them in my house. My house is worth more though on paper. Why am I being taxed more for having a big mortgage and less wealth?

Show quote history

You are buying an expensive house that is an asset though. Your shortage of disposable income now is still an investment in your future.
It’s less unfair than a blanket tax on say petrol, where rural people need to run a car and buy fuel. That money has gone.

LipglossAndLies · 07/07/2026 04:30

Babyboomtastic · 06/07/2026 23:01

It sounds like your barometer of fairness seems to be heavily influenced on whether you'd pay more or less.

Show quote history

No you just ignore rhe point about population density and ability to deliver services with economies of scale.

Babyboomtastic · 06/07/2026 23:01

LipglossAndLies · 06/07/2026 22:38

Compared to London it is rural. That5s ny point you can't expect services to be delivered at the same economies of scale it doesn't work like that. Council tax is for local services if one town has more elderly people needing more adult social care compared to another than of course their council tax will ne higher to pay for it. Same with transport, fewer people using it fewer services and the cost per person will be higher. London has a transport system funded by those paying to use it, millions od people means more money for them to invest in it. You cant say that isnt fair.

Show quote history

It sounds like your barometer of fairness seems to be heavily influenced on whether you'd pay more or less.

LipglossAndLies · 06/07/2026 22:38

Babyboomtastic · 06/07/2026 22:31

I'm not in Dorset. It's just the place with the most expensive council tax. It's also nowhere near as rural as some counties.

Show quote history

Compared to London it is rural. That5s ny point you can't expect services to be delivered at the same economies of scale it doesn't work like that. Council tax is for local services if one town has more elderly people needing more adult social care compared to another than of course their council tax will ne higher to pay for it. Same with transport, fewer people using it fewer services and the cost per person will be higher. London has a transport system funded by those paying to use it, millions od people means more money for them to invest in it. You cant say that isnt fair.

Babyboomtastic · 06/07/2026 22:31

LipglossAndLies · 06/07/2026 22:27

As Op has said time and time again but I'll say it once more:

It's not my fault my Council Tax is lower than Dorsets.

Rural counties like Dorset have very different costs. They have far more rural roads to maintain, bin collections have to travel much further between properties, and services like adult social care and transport are more expensive to deliver because people are spread out. In a densely populated borough in London many services can be delivered more efficiently because of economies of scale.

Different Council Tax bills reflect different local costs and spending decisions, not whether one resident "should" pay more than another. The fact you pay more in Dorset doesn't mean people in London ought to be paying the same.

Kent Council went bankrupt hence why their residents pay more CT, Croydon Council in London also mismanaged funds went bankrupt and again those residents end up paying more CT.

So you see its not comparable.

Don't live in a rural area if you can't suck it up, isnt that your line to me. Thats the trade odd between living in a rural area vs more densely populated areas like cities.

If you Council is wasting money and not being efficient than vote in someone that will do better.

Show quote history

I'm not in Dorset. It's just the place with the most expensive council tax. It's also nowhere near as rural as some counties.