People looking to buy a property could be hit by higher council tax bills following a recommendation from the European Commission.
The EC said Britain should raise the council tax collected from higher value properties, as part of its annual advice issued to member states to improve their economic growth. It recommended a revaluing of the council tax bands and said the current system was ‘regressive’ because the tax charged for lower value homes was relatively high.
The EC said: “At the moment, increasing property values are not translated into higher property taxes as the property value roll has not been updated since 1991 and taxes on higher value property are lower than on lower value property in relative terms due to the regressivity of the current rates and bands within the council tax system.”
The recommendations also included action on the Government’s Help to Buy scheme, which has been credited with helping to kick start the housing market by providing help for potential buyers who only have small deposits.
The EC added that the UK needs to build more homes to meet demand and should be prepared to adjust the Help to Buy initiative if necessary and to create other ‘appropriate incentives’ to boost the supply of new housing.
European leaders are set to meet to discuss the new recommendations, the BBC reported.