Labour should refom council tax, says Sheffield MP

Mr Betts, who has headed up the Housing and Levelling Up committee for over a decade, said that in order for devolution and inequality to be properly addressed in the UK, a Labour government will have to look at reforming local taxes as well as council tax.

However, he said that due to the unpopularity of tax changes, he couldn’t see Labour bringing up changes to local taxes until after the general election.

“Everyone who pays less tax says “thank you very much” and moves on, but everyone who ends up paying more tax remembers it 10 years later,” he said during a visit to a local business in Sheffield.

Mr Betts said that reform should not be viewed as a “zero sum game” where some people have to pay more tax, and others pay less, rather that taxes must be kept constant for some, as well as brought down for other areas.

“You have to make sure you build a system where you perhaps give more powers to raise money locally, and make sure that the money you raise is less regressive than the council taxes.”

This comes after Rachel Reeves, Labour’s shadow chancellor, told the Yorkshire Post that councils would not be given new tax-raising powers under a Labour government.

“You need to reform council tax because it’s very regressive in the way it takes more money away from poorer people,” he said.

He added that other taxes such as business rates are a “minefield of difficulty” but that “we’re going to have to make changes”.

“But, I don’t think we’ll announce them until after the election.”

Late last year Michael Gove, the Levelling Up Secretary, indicated that Lee Rowley, one of his ministers, is currently looking at reforming council tax at his and the Chancellor’s request, which Mr Gove had described as the “second most unpopular tax in the country”.

Mr Betts said that his expertise may not be needed in a Labour Government due to his age after turning 73 last month.

“I’m getting to the age where those opportunities may have gone,” he said, but added that he would remain vigilant to make sure the policies of devolution are properly followed through.

“I will certainly see myself as someone who is agitating constantly to make sure the promises we are making are kept.

“I think Keir generally is committed. I’ve challenged him several times and I wasn’t convinced to begin with, but he is now very clear that you can only address these problems by devolving power down to a local level.”

Mr Betts, speaking to The Yorkshire Post while visiting Food Works Sheffield, a company that “upcycles” unwanted food into affordable meals for the local community said that business like these, which receive funding from investment groups such as Big Society Capital, were key to one of the main barriers to levelling up, productivity.

“Productivity is a big reason why there is a massive difference in wealth and income levels in this country,” he said.

He said that data from Professor Philip McCann, an award-winning economist, previously part of the University of Sheffield, showed that productivity in the major cities of the North of England is lower than the Czech Republic.

“It’s staggering.. And until you address that issue, and bring high paid well skilled jobs and all the training that goes with it, and the infrastructure, it goes with it into northern areas, big cities, in particular, then you're not doing anything about the fundamental disparities that exist in this country.”