Burnham's mentor Lord Blunkett warns his 'land value tax' hammering London and the South East would take years to implement and cause fury
By JAMES TAPSFIELD, UK POLITICAL EDITOR
Published: 06:45 EDT, 23 July 2026 \| Updated: 06:58 EDT, 23 July 2026
Andy Burnham's political mentor has warned that his mooted 'land tax' would take many years to implement and cause fury in London and the South East.
Lord Blunkett said imposing annual charges based on a percentage of the value of land would be 'politically problematic' and 'dislocate the system because of the winners and losers'.
The warning comes amid predictions that switching from council tax and stamp duty to such a levy could leave millions facing eye-watering bills and send property prices plunging.
The incoming PM has talked up his determination to overhaul the tax system, with huge pressure from MPs to raise more cash for spending.
Mr Burnham has previously said he is 'persuaded' of the argument for an LVT, which would be based on the undeveloped value of land.
Although the exact shape is unclear, recent modelling from think-tank Tax Policy Associates has underlined the huge impact there could be on the capital and surrounding counties - while other areas benefit.
Some households, many of whom have taken on large debt to live in expensive areas, would face paying more than £50,000 a year.
Modelling from Tax Policy Associates underlined the huge impact on the capital and surrounding counties - while other areas could benefit
Lord Blunkett said imposing annual charges based on a percentage of the value of land would be 'politically problematic' and 'dislocate the system because of the winners and losers'
The researchers found that an annual levy of 1.28 per cent of the land value would roughly cover the current revenues from council tax and stamp duty.
But the estimates - which they stressed are only illustrative - suggested that owners of a band F flat in Islington would be paying £12,000 a year, instead of £2,900 in council tax.
People who bought a band H property in Westminster or Kensington that has soared to be worth millions of pounds would need to find £44,000 and £54,000 respectively.
Outside the M25, the owner of a Band F home in Guildford would be facing a £6,200 a year charge, instead of £3,500 in council tax at present.
A Band F in Brighton attracts similar council tax currently, but would be in line for an £8,700 annual bill.
The report suggests there could be transitional arrangements, including credits offsetting stamp duty already paid.
But it also highlights that postponing collection of the tax would mean the percentage charge has to be significantly higher.
The model projects eye-watering property falls in the areas affected, such as a 19 per cent plunge for average homes in Richmond-Upon-Thames.
The report points to an example from Australia where changes were phased in over 20 years as a possible solution.
Andy Burnham has previously said he is 'persuaded' of the argument for an LVT, which would be based on the undeveloped value of land
Lord Blunkett, who served in Tony Blair's Cabinet, told the i a switch to LVT would need to be a '10-year project'.
'It cannot happen in the immediate future. So there's got to be a grounding of reality in politics, as well as radical thinking,' he said.
Liverpool Metro Mayor Steve Rotheram, another close ally of Mr Burnham, highlighted the impact on people who were 'capital rich' but do not have much cash.
'There's ways in which we would have to look at all of those implications and considerations in developing something, but the fairness thing is going to be one of the overriding drivers and everything that Andy will do,' he said.