Council Tax is based on 1991 property values. The eight bands, ‘A – H’, reflect those valuations, which haven’t been revised for 35 years. One outcome is that band ‘H’ houses pay a lower percentage Council Tax than band ‘A’. Council Tax is a reverse wealth tax.
Havering’s band ‘H’ Council Tax is £4,849.32.1 At the other end of the scale a band ‘B’ house pays £1,885.85.2 Council Tax was meant to be a property tax, which is absolutely not the case now.
There are many houses in Havering priced at £1m+, some of which are not in band ‘H’. Rightmove is advertising a house in Hornchurch for £3.9m.3 It’s in band ‘H’ and the Council Tax is £4,849.32. £4,849,32 is 0.12% of the price. This tiny amount isn’t even a ‘rounding error’. Simultaneously Rightmove is advertising a band ‘B’ property for £190,000.4 Their Council Tax is 0.99% of the value of the property. They pay eight times more than the band ‘H’ house in percentage terms. Council Tax means the poor subsidise the rich.
If the Band ‘B’ 0.99% Council Tax is used as the default, there would be sharp increases for expensive houses. A flat rate percentage Council Tax is a pure property tax. To equalise the Council Tax at 0.99% would level the playing field and end the subsidy that the rich receive from the poor.
Using the two houses that illustrate this blog, the Band ‘B’ house stays the same. This is absolutely not the case for the property valued at £3.9m. Their Council Tax increases from £4,849.32 to £38,610 p.a. This stonking increase is a vivid statement of the grotesque unfairness of the 1991 Council Tax banding system. Can you imagine the cries of horror of those who have this increase inflicted on them? Yet 0.99% is exactly what the poor are paying and it is equally unaffordable for them.
A percentageCouncil Tax is a fair property tax.
Conclusion
It will take enormous political courage, by Andy Burnham, to reform Council Tax. The losers will be the rich who can manufacture ‘outrage’ in the media. Meanwhile councils creak towards oblivion.
Addendum: Reforming Council Tax
There is nothing Keith Prince can do even if he wanted to. The point of this blog is to give a Havering context to the debate about Council Tax reform.
Notes
1 Council Tax bands and bills | London Borough of Havering
2 1 bedroom flat for sale in South Street, Papermill House, 363 South Str, Romford, RM1 I tried to find a band A property and couldn’t.
3 8 bedroom detached house for sale in Freeman Way, Emerson Park, Hornchurch, RM11 Accessed 16th July 2026
4 1 bedroom flat for sale in Grenfell Avenue, Hornchurch, RM12 Accessed 16th July 2026