Councils should not be used to administer a national tax on high-value properties, the Local Government Association (LGA) has warned, cautioning that the plan could be costly for councils, confusing for residents, and damaging to local accountability.

The Government's proposed High Value Council Tax Surcharge (HVCTS) would apply to homes worth over £2m, with rates, eligibility and exemptions set entirely by central government.

Yet councils would be responsible for billing, collection and enforcement – including pursuing debt from overseas owners – without retaining any of the income, which would return to Government.

In its consultation response, the LGA said this risks creating ‘a complex, costly and inefficient parallel system,’ with significant staffing, legal and technology costs and no guarantee of full funding.

It also warned residents may wrongly hold local councillors accountable for a national tax, and that enforcement against non-resident owners could prove resource-intensive with unclear legal powers.

The LGA is urging Government to consider national administration instead, or at minimum guarantee upfront investment, full cost recovery, and transparency for bill payers.

In their words

Cllr Kam Rai, chair of the LGA's Resources Committee, said: ‘The surcharge is a national tax, yet councils would be left to administer it, carry the risk, and deal with the confusion it will create for residents.’

Cllr Rai added that without full funding and clear accountability, the proposal ‘risks adding cost and complexity at a time when councils are already under enormous pressure,’ and called for a ‘cast-iron guarantee’ that any revenue raised would be genuinely additional, not used to offset reductions elsewhere.

‘Councils should not be expected to run a new national tax system that could leave them out of pocket and undermine local democratic accountability,’ he added.