Tax-raising powers for local authorities should increase


A think tank has called for the government to give local authorities more power to amend taxes and raise revenue…

A report from think tank Centre for Cities has called for devolution powers to go further and give local authorities more control over their revenue.

Centre for Cities said plans to devolve tax should also include other tax-raising methods such as stamp duty. This, the think tank said, would prevent local authorities from fighting over resources and revenues.

The Spending Review outlined plans from Chancellor George Osborne to allow combined authorities in the north and Midlands to keep extra revenue from business rates collections. However, these powers should go further, the think tank said. Allowing authorities to have more control would enable them to raise billions, which would attract investment and increase job prospects.

One area singled out by the think tank was stamp duty revenues. This would add £10bn to the £23bn of business rates revenue. It would also help to push through planning permission for house building, which would add another £1bn.

The report, ‘Beyond business rates: incentivising cities to grow’, warned that business rates revenue would only have a positive impact on councils with prosperous commercial centres. Those with little development would see little benefit. Therefore it is necessary to look at other methods of raising money.

In October, Moody’s—a credit ratings agency—said some authorities would be left with shortfalls despite being offered business rates revenue. It highlighted in particular rural councils and areas with deprivation. In fact, council funding cuts put forward in Osborne’s Spending Review last month will leave a whopping £4.3bn funding gap.

Chief executive of the Centre for Cities Alexandra Jones said: “The government’s move to devolve business rates was an important step in the right direction, but it doesn’t go far enough.

“Devolving land and property taxes would encourage places with weaker economies to develop their tax base, while also giving places with high economic demand more incentives to take the often difficult decisions needed to invest in infrastructure and new housing.

“This should be the next step in the government’s devolution agenda; to ensure that local leaders across the country have the powers and responsibilities they need to help their local economies thrive in the years to come.”


  1. This beggars belief. Here we have a government who are trying to pass on their failures to local government. Again, who will it affect? It’s obvious – the weak and vulnerable. This think tank could not think its way out of a paper bag. I am really upset with a Government that only thinks about the rich and sod everyone else. It’s not fair, its unjust. I have a way to raise money locally and its very simple 1% added to your food bill: everyone pays and it reduces the burden to already over stretched local government. Everyone shops but not everyone pays council tax. This means that rich and poor alike all contribute to local services and protect the vulnerable. This way it also means that the poor pay less and the rich pay more. If we put 3% on food and abolish council tax that would please all of the people all of the time. You have to realize that the working class of this country are not a bottomless pit.

  2. If you remember the so called POLL TAX was an alternative which all persons over 18 were supposed to pay not just one or two in a household of many more, a much fairer way as every adult paid. It was well and truly rejected by the young whose parents mainly paid it for the whole household. Single people on their own were not landed with 3/4 of a bill which was shared in a similar house next door by possibly 6,8 10 people. Unfortunately it was uncollectable. I suggest give it another chance, call it Council Tax 2


Please enter your comment!
Please enter your name here