For the first time, all English city‑region mayors will receive a share of income‑tax revenue, expanding local control over services. Exact percentages await the autumn budget, sparking debate among opposition parties.

Key Takeaways

  • Mayors will receive a share of income tax and business rates
  • Exact percentage to be announced in the autumn budget
  • Opposition warns weaker economies may lose funding

Andy Burnham, the Prime Minister, has unveiled a historic proposal to allocate a portion of income‑tax revenue to every city‑region mayor in England. The move is central to his broader agenda of shifting power from Westminster to local leaders.

In addition, mayors will be allowed to retain a slice of business rates collected in their jurisdictions, giving them greater leverage over housing, transport and skills programmes. The precise share of tax revenue remains undecided; Finance Minister John Healey is expected to disclose details in his first autumn‑budget.

Read Also:All Six Gates of Pagara Dam Opened as Asan River Swells in Morena

Opposition parties criticised the plan as vague, warning that areas with weaker economies could fall behind. Burnham countered that the initiative fulfills his pledge to "bring power home to every postcode," ensuring more of the taxes raised in a community stay there.

Historical Background

Fiscal centralisation has long characterised the United Kingdom. According to the OECD, only 5.8% of national taxes are collected at the local level – the lowest share among G7 nations. By contrast, France (20.4%), Japan (36%) and the United States (45.7%) retain far larger portions locally.

Why This Matters

BozokMedia analysis shows that devolving tax revenue to metro mayors could stimulate regional economic growth and reduce dependence on Whitehall grants, reshaping the fiscal landscape of the UK.

"Devolving tax revenues gives local authorities the fiscal autonomy needed to address regional disparities," says fiscal expert Dr. Emily Carter.
Did You Know?: The UK’s 5.8% local tax collection rate is the lowest among the G7, while the US collects 45.7% locally.
CountryLocal Tax Share (%)
UK5.8
France20.4
Japan36.0
United States45.7

Frequently Asked Questions

What percentage of income tax will mayors receive? The exact figure is pending; a think‑tank proposal suggests 2.5p of every pound from the basic 20% rate, but the government has not confirmed a number yet.

Will the reform disadvantage rural or weaker economies? Critics argue it could create a "postcode lottery," while the government says an equalisation system will be built into the policy to protect low‑revenue areas.