Local authorities should be given control of £10bn stamp duty tax, report urges

A report entitled ‘Beyond business rates: incentivising cities to grow’ has argued that councils should be handed more control of their finances, including the £10 billion generated in stamp duty tax. 

The study, published by Centre for Cities, analyses the government’s plans to devolve control of businesses and believes councils should be given more responsibility for their spending. 

The report outlines how devolving land and property taxes could put local authorities in charge of 41 per cent of their spending, based on 2014-15 figures, compared to just 19 per cent in the current system of funding. 

The authors claim that by devolving more fiscal powers, local areas will be incentivised to boost growth and create a sustainable system of local government funding for the future. Furthermore, the move would ensure spending decisions are made on the unique needs of their local communities. 

Alexandra Jones, chief executive of the Centre for Cities, said: “The government’s move to devolve business rates was an important step in the right direction, but 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.”