Sadiq Khan opposes mansion tax while business groups seek fiscal devolution

London Mayor Sadiq Khan has expressed opposition to a potential government proposal to lower the threshold for the planned High Value Council Tax Surcharge from £2m to £1.5m. Khan argued that such a move, often referred to as a “mansion tax,” would disproportionately affect London and the South East, targeting residents who may be “asset rich but cash poor” due to high property values.

Simultaneously, business groups including BusinessLDN and the Central District Alliance are calling for increased fiscal devolution. They have urged Prime Minister Andy Burnham to grant the Mayor of London greater powers over taxation, spending, and infrastructure investment. The groups suggest that allowing local leaders to retain a larger share of locally raised taxes, such as business rates, would incentivize growth and allow for better-tailored investment in housing, transport, and education.