Commons Sense

House of Commons · Adjournment Debate

Council Tax Reform 2025-03-19

19 March 2025 · 2 other contributors

Opened by Jonathan Brash Lab Hartlepool

Summarised by AI from the official record, so it can contain mistakes.

At a glance

Jonathan Brash raised concerns about council tax reform 2025-03-19 in the House of Commons. A government minister responded. Other MPs also contributed.

Key points

  • Council Tax for a Band A property in Westminster is 648 a year, while in Hartlepool it is 1,585.
  • Council tax in Hartlepool represents 9% of median gross pay, compared to 2% in Westminster.
  • Nationally, one in ten people in the UK have been in council tax debt, with nearly 40% threatened with legal action.

How the debate unfolded

MPs spoke in turn to share their views and ask questions. Here's what each person said.

Opened the debate

Jonathan Brash Lab Hartlepool

Council Tax is, without doubt, the most unfair, regressive and punitive taxation system in this country. It is hammering towns such as Hartlepool. Places with high deprivation and low wages—the very areas that a fair tax system would support—are instead being squeezed to breaking point by a broken system that must be fixed. A Government that stand up for working people, promise change and have a mandate for that change cannot sit back while such fundamental unfairness continues. The numbers speak for themselves. For a band A property in Westminster, it is £648 a year. In Hartlepool, it is £1,585. A Band H property in Hartlepool pays nearly £3,000 a year more than one in Westminster. Council tax in Hartlepool represents 9% of median gross pay. Here in Westminster, it is just 2%. Someone can live in a multimillion-pound property in London and still pay less council tax than someone in a terraced house in Hartlepool. It is not right. It is not fair. It must change. My hon. Friend the Member for Easington (Grahame Morris) mentioned property prices, and they are at the heart of the unfairness. In Hartlepool, 53% of the properties are in band A. Here in Westminster, that figure is 1.2%. In Hartlepool, only 3.7% of the properties are in bands F to H, yet in Westminster it is almost half of all properties. My hon. Friend mentioned property prices, and they are at the heart of the unfairness. In Hartlepool, 53% of the properties are in band A. Here in Westminster, that figure is 1.2%. In Hartlepool, only 3.7% of the properties are in bands F to H, yet in Westminster it is almost half of all properties. Nationally, one in 10 people in the UK have been in council tax debt, and nearly 40% of those individuals have reported being threatened with legal action as a result. Outstanding council tax debt already stands at £6 billion. This week I spoke to Caroline, a development officer in Hartlepool who supports many of the most vulnerable in our community. She told me of one working family for whom council tax, even with the reduction, is now the equivalent of more than a third of their mortgage payment. Dad works and mum is a full-time carer for their disabled son. They live in fear of not being able to pay. They do not understand where their money goes and they do not feel any benefit, only financial pain. At the heart of this broken system is social care, as has been mentioned already. Nearly 70% of Hartlepool’s budget is spent protecting the most vulnerable children and adults in our town, and that is mirrored in areas of need across the country. No one in their right mind would design a care system funded by a regressive tax levied on small, struggling communities. There are alternatives. Andrew Dixon and the Fairer Share campaign have advocated for a proportional property tax that would ensure contributions were based on actual property values. Some 70% of households in the north-east would be better off. Nearly a third would save as much as £1,500 a year—money that could help struggling families put food on the table, heat their homes and buy their children the things they need. If Ministers ignore council tax reform, they do so at their peril.

Other contributors (2)
  • Sarah Dyke Lab Somerset

    Councils like Somerset are forced to raise council tax but face budget shortfalls due to decisions made by the previous Conservative administration.

  • Richard Foord Con Tiverton and Honiton

    Shire counties such as Devon have seen significant funding cuts and struggle with maintaining road networks.

Government Response

The Minister acknowledges the issues raised by council tax reform but notes that a revaluation is not planned in this Parliament. The government proposes to update funding allocations to reflect current property values and local resources. They aim to deliver reforms through a multi-year settlement from 2026-27, including updating the fair funding review. There are ongoing consultations on objectives and principles for reforming council tax. Councils will have £69 billion available this year, with £5 billion of new money and a recovery grant of £600 million to bridge towards future reforms. The minister recognises that repairing 14 years of harm will take time but is committed to moving at pace. He emphasises the predictability and local control associated with council tax, while acknowledging its regressive nature and seeking ways to support those less able to pay through discounts and exemptions.

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