RBKC Leader Elizabeth Campbell has come out fighting again to stop the Government from implementing its dreaded “mansion tax” in 2028.

Cllr Campbell has ramped up her campaigning efforts by creating a powerful cross-party group of councils – duly dubbed “The Rebel Alliance” by The Citizen – to join forces with RBKC in challenging the Government to “pause” its plans for the High Value Council Tax Surcharge (HVCTS) on homes worth more than £2m.

The three other councils are the City of Westminster, Wandsworth, and Richmond upon Thames and this week they sent a stinging letter – under the banner of four council mastheads – to new Chancellor of the Exchequer John Healey pulling apart the fundamentals of the new tax.

In a strongly worded and emotionally charged two-page letter, dated 5th August, the council leaders dismiss the scheme as “a badly thought-out policy” which will have “a hugely disproportionate impact on our residents”.

The letter claims that their residents will be unfairly hit by the tax due to the exceptionally high property values in their boroughs. It states that “around £270 million” will be collected from its residents, which will account for 50% of the TOTAL revenue extracted from across Britain. 

“Few groups of boroughs are as directly and disproportionally affected by these proposals as we are,” the letter declares.

In a direct rebuke to Prime Minister Andy Burham’s Government, the four leaders accuse it of being “disingenuous” about the tax, not least because it is being labelled a “council tax surcharge” – yet NO funds will be spent on local services. Instead, the revenue will be dispersed by central Government to “deprived” areas, mainly in the North.

The letter claims that many families who are ‘property rich, but cash poor’ face losing their homes, or accepting a high interest debt with the Government that will erode equity and, thereby, any future inheritance from property sales for families.

The letter lambasts the Government for the way the scheme has been set up, most markedly for its property targeting method, which the leaders dismissively say is based on “a desktop valuation exercise carried out by the Valuation Office Agency”.

The letter continues: “A home is the centre of family life, not an untapped tax stream…It is simply wrong to assume that everyone living in these homes is wealthy. Many are not, and under this proposal, some will be forced to sell the family home simply to meet the tax…If the Government’s intention is to make the wealthy pay more, this is the wrong way to achieve it.”

Only last month, Cllr Campbell detonated the first blast of her campaign to stop the HVCTS by writing to the Chairs of all RBKC residents associations urging them to get their members to file complaints to the Government about it.

That letter sparked a furious backlash from Labour MP Joe Powell who accused her of “scaremongering” and for getting the figures all wrong. 

As well as “The Rebel Alliance” letter, Cllr Campbell also wrote this week to the RAs in equally emotive language. She said: “Four councils, united across party lines, sending one message: this policy is wrong, and it risks our residents losing their homes.”

The press statement from the four council asserts that the calculations for its criticism of the HVCTS are based on figures of “presumed mansion tax liabilities” from a study by Tax Policy Associates.

The Citizen will contact the Government for a response.

 

 

Cllr Campbell’s email to RA Chairs

Dear RA Chairs,

I hope you are well.

Last month, I wrote to you about the potential impact of the Government’s plans for a Mansion Tax. I promised that the Council would fight the Government hard on this, and I am pleased to say that I have brought the London boroughs of Richmond, Wandsworth and Westminster together in a joint letter to the new Chancellor of the Exchequer, attached, asking the Government to change course. Four councils, united across party lines, sending one message: this policy is wrong, and it risks our residents losing their homes.

Please do share the letter with your residents if you think it would be useful.

I know that many of you responded to the Government’s consultation in July, and I am very grateful for your support. I will keep you updated, and let you know of any future consultations.

Best wishes,

Elizabeth

 

The four signatories of the letter to the Chancellor issued these press statements to accompany the letter

 

Cllr Elizabeth Campbell, Leader of Kensington and Chelsea Council, said:

“I have brought together the leaders of four London boroughs that will bear the brunt of this tax because the scale and deeply disproportionate impact of these proposals cannot be ignored. Our residents alone could be forced to pay more than half of the national bill.

“This is not a tax carefully targeted at the very wealthy. It lacks nuance and will hit pensioners, families and long-standing residents whose homes have risen in value while their incomes have not. People should not be punished simply for staying in the communities they have helped to build.

“The Government is calling this a council tax surcharge, but our council will not keep a penny of it for local services. It is a national tax, disproportionately extracted from a handful of London boroughs, and it is badly designed, costly to administer and fundamentally unfair.

“We are speaking with one voice – the Government must pause, listen and think again.”

 

Cllr Robert Morritt, Leader of Wandsworth Council, said:

“Many people living in these homes are normal families, pensioners and long-time residents who have lived in the same property for years. They now face additional taxes simply because house prices have risen around them.

“This is an unworkable and misleadingly named policy. Government should be honest about it rather than presenting it as an extension of council tax.

“Wandsworth Council won’t get to keep a single extra penny raised. This is an unfair attack on well-run councils like ours, with Wandsworth residents hammered to pay for those elsewhere.”

 

Councillor Gareth Roberts, Leader of Richmond Council, said:

“Many Richmond residents have lived in the same homes for decades, raised families, contributed to their communities and grown older locally and, in many cases, the value of their homes has risen dramatically, while their incomes and personal circumstances have stayed largely the same or even declined.

“What the government is doing is adopting a quick fix approach to try to solve the broken system of Council Tax. If the Government is serious about addressing the issue of local government funding they need to reform the whole system; messing around with a blunt approach such as this helps nobody, particularly given that the entirety raised with this new tax will go to the treasury and not a penny will go to fund services here in Richmond.

“Essentially, the Government is seeing Richmond residents as cash cows that they can milk to fix funding gaps elsewhere in the country, irrespective of whether they can afford to pay this new tax.”

 

Cllr Paul Swaddle, Leader of Westminster City Council, said:

“Westminster does not support the surcharge, either in principle or design. It would fall especially heavily on Westminster, where high property values do not always translate into high household incomes, and it risks creating unfair outcomes for residents whose property value does not reflect their ability to pay, including long-standing residents in high-value homes, leaseholders, tenants who may see costs passed through rents, and homes that do not fit neatly into the Government’s assumed model of wealth.”