“There are people here in Greater Manchester who pay a much higher council tax than people living in much larger homes in London,” the new Prime Minister told the BBC’s Panorama ‘Andy Burnham: the Laura Kuenssberg Interview’.
Speaking from his new No10 North headquarters in Manchester, he continued: “So the Chancellor before, Rachel Reeves, was right to start to reform council tax to create some fairness there in relation to people in homes that are of much greater value, who haven’t seen their council tax go up over the years because of the failure to revalue the banding.”
Given the exorbitant property prices in London, and rent levels, there are also many people living in the capital in far smaller properties than in Manchester, including some paying higher council tax.
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Former Chancellor Rachel Reeves
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Property tax
The former Mayor of Greater Manchester has previously backed a new property tax, which would replace council tax and stamp duty.
The proportional property tax would be charged at 0.48% of the value of a property, rising to 0.96% for second homes, empty homes and those owned by foreign nationals.
Andy Burnham previously backed replacing council tax and stamp duty with a new property tax
The London Standard
Mr Burnham has played down the likelihood of his Government embarking on such a major tax reform, which would require a revaluation of all properties, imminently.
“It’s just not the case that we are bringing forward plans, on that scale, at this moment in time,” he said.
But this stopped far short of ruling out significant changes to property tax in the autumn Budget or later years.
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Options available include reducing the threshold for paying the “mansion tax” to possibly £1.5 million or introducing new council tax bands on expensive properties.
Inheritance tax
To his credit, Andy Burnham is prepared to gamble in taking some big decisions which most other Prime Ministers have shied away from doing including on tackling Britain’s social care crisis.
He is seeking cross-party talks to find a solution to the gaping shortcomings in adult social care provision across the country.
Britain’s social care system is in crisis
He has previously pledged to expend “whatever political capital I have” on fixing England’s social care system, warning the NHS “will collapse” otherwise.
Inheritance tax is currently charged at 40% on estates worth more than £325,000, or £500,000 if it includes passing on a home to children.
Given the high property values in the capital and huge wealth, around £1 in £4 in inheritance tax is already paid by Londoners, and add in the wider South East that figure rises to £2 in £4.
A 10% charge on all inheritances would somewhat equalise the proportion of the tax paid by London, compared to other regions, but it would still be by far the biggest contributor to the Treasury under such a system.
Banks levy
Barclays has revealed its profits jumped by 17% over the first half of 2026 as its investment bank cashed in on more dealmaking and activity in the financial markets.
It reported a pre-tax profit of £6.1 billion for the first six months of the year, up from £5.2 billion in the same period a year ago.
Barclays announced higher than expected profits
AFP/Getty
As the banks rake it in as millions of people are still struggling with the cost of living it is not surprising that calls are growing, including from union chiefs, for them to pay more tax.
The Trades Union Congress is urging Mr Burnham to increase the bank surcharge by between £9 billion and £60 billion over four years.
Income tax
The new PM has stressed that he faces some difficult decisions on tax as he seeks billions more pounds to pay for defence, his plans to level up Britain and for social care.
Overall, he has given little details of his tax proposals, which would be expected to be laid out in the Budget.
But he has also said he may be “asking for a little bit more” on tax, with the better off clearly in his mind.
Mr Burnham has vowed to stick to Labour’s 2024 election manifesto not to raise the rates of income tax, VAT or National Insurance contributions for employees.
But could he be tempted to bring back the 50p top rate of tax?
Wealth tax
The new Prime Minister could decide to introduce a wealth tax, though, this might be complicated to collect and ensure people did not avoid paying it.
Some campaigners and charities have been calling for a 2% tax on assets over £10 million.
Zack Polanski’s Green Party supports a 1% annual levy on assets above £10 million and of 2% on assets over £1 billion.
It also backs reforms to capital gains tax (CGT) to align the rates with those paid by taxpayers on income.
As Mr Burnham seeks more funding, whether this is through a new property tax, wealth tax, changes to CGT or another levy is yet to become clear.
But what is almost certain is that London will bear the brunt of any tax rises.
