What could Andy Burnham mean for your tax bill?

There has been plenty of speculation, but relatively little agreed policy. Burnham has expressed an interest in making the tax system fairer and has previously argued that Britain ‘overtaxed labour and undertaxed’ wealth. However, that does not mean the various tax changes being discussed will necessarily happen.

Chancellor John Healey’s first Budget on 28 October should provide a much clearer picture but in the meantime, we look at possible tax cards that Burnham might play.

Could income tax change?

One area Burnham has explicitly said should be examined is the income tax personal allowance.

He has previously criticised the freezing of income tax thresholds and, before becoming Prime Minister, said the personal allowance (currently £12,570) should be looked at. He has stopped short, however, of promising an increase.

He has also previously proposed a 10% starting rate of income tax for lower earners, which would mean taxing part of the income currently subject to the 20% basic rate at a lower rate.

For higher earners, the immediate position is clearer. Burnham has backed Labour’s commitment not to increase the main rates of income tax, employee National Insurance or VAT. This means there is currently no announced plan to increase the 20%, 40% or 45% income tax rates.

Changes to allowances or thresholds could still affect tax bills without headline rates changing. This is particularly relevant to higher earners because the personal allowance is gradually withdrawn once adjusted net income exceeds £100,000 and disappears completely at £125,140.

Could capital gains tax rise?

Capital gains tax (CGT) is one of the areas attracting most speculation. This matters particularly to investors, landlords and entrepreneurs disposing of businesses, shares or other assets.

For 2026/27, the main individual CGT rates are 18% and 24%. Qualifying gains benefiting from Business Asset Disposal Relief are taxed at 18%. One suggestion has been to move CGT rates closer to income tax rates. Former health secretary Wes Streeting proposed aligning the two during the Labour leadership debate, while allowing for inflation when calculating gains. But to date, there is currently no Burnham government proposal setting out higher CGT rates or changes to Business Asset Disposal Relief.

Is a wealth tax on the cards?

A possible wealth tax has also generated considerable attention. Burnham has previously declined to rule one out when questioned about how a future government could make taxation fairer. But he has not put forward a detailed wealth-tax policy. There is currently no government proposal specifying a rate, threshold or what assets would be included.
Various economists, campaigners and other politicians have advanced their own proposals for taxing wealth. These have contributed to the debate, but should not be confused with Burnham government policy.

For high-net-worth individuals, a wealth tax is therefore best regarded as a possibility being discussed, rather than an expected change on which financial plans should currently be based.

What about property taxes?

Burnham has a longer history of calling for reform of property taxation. He has described the current council tax system as ‘highly regressive’ and has previously backed proposals to replace council tax and stamp duty with a tax based more closely on current property values. He has also spoken favourably about the principle of a land value tax. That does not mean such a change is imminent. Burnham has explicitly ruled out changes to stamp duty at the October Budget, saying the government is not currently bringing forward reform on that scale.
Owners of high-value homes in England do, however, already face a significant change from April 2028.

The High Value Council Tax Surcharge will apply to owners of residential properties valued at £2 million or more. Under the existing plans, annual charges will range from £2,500 for properties worth between £2 million and £2.5 million to £7,500 for homes worth more than £5 million.

What could change for business owners?

For owner-managers, the picture is not simply one of potentially higher taxation. Burnham has made reducing costs for smaller businesses part of his early economic programme. His government has already announced an additional 20% business-rates reduction from 2027/28 for eligible pubs, social clubs and live music venues in England, alongside plans to reconsider how the business-rates burden is distributed.
He has previously argued that more of that burden should fall on large warehouses and superstores rather than high-street businesses. For owner-managers, changes to CGT, property tax or personal allowances could influence both personal wealth and plans for selling or passing on a business. For now, the key message is that many of the more significant changes being discussed remain just that: under discussion. The Budget on 28 October should begin to show which of these ideas, if any, are likely to move from the endless speculation to baked in government policy.

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The information contained is for guidance only and does not constitute financial advice. It is based on our understanding of UK legislation, whether proposed or in force, and market practice at the time of writing.
Levels, bases and reliefs from taxation may be subject to change. Accordingly, no responsibility can be assumed by Lycetts, its officers or employees, for any loss in connection with the content hereof and any such action or inaction.

Sources

• https://www.reuters.com/world/uk/how-uk-pm-burnhams-government-might-raise-taxes-2026-07-20/
• https://www.gov.uk/government/news/budget-to-move-power-and-money-out-of-westminster-and-into-every-postcode-around-britain?
• https://www.reuters.com/world/uk/new-uk-leader-burnham-says-he-will-never-take-risks-with-economy-2026-07-20/
• https://www.tax.org.uk/andy-burnham-s-tax-agenda-early-signals-for-a-probable-premiership
• https://www.gov.uk/capital-gains-tax/rates
• https://www.gov.uk/capital-gains-tax/rates
• https://www.reuters.com/world/uk/uks-streeting-pledges-wealth-tax-that-works-labour-leadership-bid-bbc-reports-2026-05-21/
• https://www.tax.org.uk/andy-burnham-tax-agenda
• https://www.reuters.com/world/uk/uk-pm-burnham-rules-out-changes-stamp-duty-next-budget-2026-07-27/
• https://www.gov.uk/government/publications/high-value-council-tax-surcharge/high-value-council-tax-surcharge
• https://www.gov.uk/government/news/burnham-means-business-pm-slashes-business-rates-bills-for-pubs-clubs-and-live-music-venues