Delivery of Budget 2026 through property tax systems

Summary

That this House notes that many announcements in Budget 2026 are predicated on out-of-date property tax systems and that the Government’s Household Energy Payment will be distributed through the outdated council tax system, resulting in 1.4 million low-income households being excluded while channelling payments to some high income individuals; further notes that the high value council tax surcharge is also based on the outdated council tax system and requires a new government-funded valuation exercise, which will likely result in disputes, delays and uncertainty relating to properties that fall near the banding limits; recognises that support for retail, hospitality and leisure businesses announced in the Budget is being delivered through the broken business rates system, which means that businesses of a similar size but with higher rateable values will miss out on the increase of the Small Business Rate Relief threshold, creating arbitrary and unfair outcomes; regrets that the Conservative party and Labour Party thus far have failed to implement their respective 2019 and 2024 manifesto commitments to replace the business rates system; supports the Government’s ambition to allow local authorities to retain more of their business rates revenue, but believes this should not become an excuse for delaying much needed reform of the underlying business rates system; believes that council tax, stamp duty and business rates need to be overhauled; and calls on the Government to establish a commission on property tax reform with a view to overhauling outdated taxes such as council tax, stamp duty and business rates.

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Timeline

1. 29 October 2026

   Early Day Motion

   That this House notes that many announcements in Budget 2026 are predicated on out-of-date property tax systems and that the Government’s Household Energy Payment will be distributed through the outdated council tax system, resulting in 1.4 million low-income households being excluded while channelling payments to some high income individuals; further notes that the high value council tax surcharge is also based on the outdated council tax system and requires a new government-funded valuation exercise, which will likely result in disputes, delays and uncertainty relating to properties that fall near the banding limits; recognises that support for retail, hospitality and leisure businesses announced in the Budget is being delivered through the broken business rates system, which means that businesses of a similar size but with higher rateable values will miss out on the increase of the Small Business Rate Relief threshold, creating arbitrary and unfair outcomes; regrets that the Conservative party and Labour Party thus far have failed to implement their respective 2019 and 2024 manifesto commitments to replace the business rates system; supports the Government’s ambition to allow local authorities to retain more of their business rates revenue, but believes this should not become an excuse for delaying much needed reform of the underlying business rates system; believes that council tax, stamp duty and business rates need to be overhauled; and calls on the Government to establish a commission on property tax reform with a view to overhauling outdated taxes such as council tax, stamp duty and business rates.

   Source: Early Day Motion

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Sponsors

• Daisy Cooper · Liberal Democrat · Primary sponsor

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