Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of the potential merits of reforming local authority revenue-raising powers in relation to (a) existing property and (b) future property developments.

As outlined in the Levelling Up White Paper, alongside the upcoming revaluation in April 2023 the UK Government will explore with the Combined Authorities further flexibilities to enable them to raise their own funding through the business rates system to fund local priorities, whilst also considering the impacts on business.

Regarding council tax, the Government gives Local Authorities flexibility over how they set council tax bills, although a limit is set on how bills are increased by without a referendum, and does not plan to change this.

Regarding property development, the government is exploring the introduction of a new ‘Infrastructure Levy’ to replace Section 106 planning obligations and the Community Infrastructure Levy and will be set in a way which captures at least as much value as the existing system. The proposed levy will be set and collected by a local authority to reflect local circumstances and to make sure that revenues go toward affordable housing and wider investments in infrastructure that those communities need.