PARLIAMENTARY DEBATE
Property Taxes - 3 September 2025 (Commons/Commons Chamber)

I appreciate the opportunity to speak in this debate. I want to take on the challenge set by the shadow Chancellor, the right hon. Member for Central Devon (Sir Mel Stride), so let us talk about how we got to this point, and the devastating consequences. Under the last Government, despite 27 tax rises, Government debt rose from 60% of GDP to 100.5%. They were borrowing for day-to-day spending. The shadow Chancellor talks about unfunded commitments; he knows about those, because the last Government left a £22 billion black hole of unfunded commitments. He says he cares about property ownership, but the last Government were responsible for a 6% fall in home ownership among people aged between 25 and 34. That was on his watch. This Government are building 1.5 million new homes, including record numbers of council homes and social properties. We also have renters’ rights reform, and we are looking into mortgage reform. That is about ensuring a fair and more affordable housing mix for all.

What drove that fall in young people owning homes? We have to look to inflation, which peaked at 11.1% under the last Conservative Government, almost hitting Margaret Thatcher’s record of 17%. The Conservatives seem to be comfortable with high interest rates; in 2022, food inflation hit a 45-year high. In 2023, the UK recorded the highest inflation rate in western Europe; it was the only country to have double-digit inflation. Under this Government, we have had five interest rate cuts in only a year.

The real cost of high interest rates can be found in the number of children living in poverty. There was a 20% increase in child poverty between 2014 and 2024. Food bank demand rose by 3,772% under the Conservative Government. In 2010, approximately 2.3% of children were living in relative poverty. In 2024, the figure was 4.5%, and that is shameful. It was the biggest fall in living standards on record, but under this Government, wages are finally rising faster than prices. We have seen the results of cuts in spending, particularly on youth services, which had a 73% real-terms cut under the last Government. This Government are putting £88 million back into youth clubs. Is that what the Conservatives want to cut?

Finally, I want to talk about businesses. The shadow Chancellor said that nobody on this side of the House had experience of starting, running and growing a business. I, for one, have done that, as have many others on the Government Benches. He should get to know his colleagues before he makes those assertions.

After a summer of rumoured tax rises, my constituents are deeply concerned. They are already paying more, because Labour broke its promise to freeze council tax, broke its promise not to increase national insurance, and broke its promises to first-time buyers, small businesses and farmers. Thanks to the Chancellor’s anti-business policies, growth forecasts are collapsing, borrowing costs are sky-high, and our national finances are shot.

Instead of looking at its reckless decisions, Labour is now calculating the best way to raise taxes, and my constituents are worried that the Chancellor is eyeing up their family home. In Bromley and Biggin Hill, on the edge of Greater London, homes are expensive. The average house price is well over half a million pounds, and there are rumours that the Government may scrap the private residence relief, which would be devastating. It would slap my constituents with an average £33,000 tax bill when they sell their family home. If someone has scrimped and saved, and been lucky enough to see the value of their home go up, they should not be handed a punitive tax bill. It only serves to knock working people back down when they are trying to get ahead.

Residents in Bromley, like those in Bexley, have been hit by the Mayor of London’s 77% increase in his share of council tax since he took office, alongside various driving taxes. Does my hon. Friend agree that this increase in property taxes would be the straw that broke the camel’s back for many residents?

I agree that the Mayor of London, Sadiq Khan, is causing residents in Bromley and Bexley real financial hardship. However, I in no way believe that this will be the final straw—the final way that the Mayor of London can find to damage my constituents and those of my hon. Friend. I am sure that he has plenty more straws, and a lot more camel to lay them on.

As I was saying, scrapping private residence relief would be irresponsible and economically ruinous. Imagine if somebody bought a house in Bromley in 2010 for £350,000. Today, it would cost somewhere in the region of £550,000. If they wanted to move to a new area for work or to be closer to family, without that relief, the tax bill would be somewhere in the region of £50,000. That eye-watering bill would stop people moving and wreck the housing market. That is why I urge others to support the motion, which rules out any further reckless tax rises. Working people cannot afford to keep bailing out Labour.

It is wonderful to be back for another Opposition day debate, as I am sure we can all agree. It is another debate about imagined proposals. It must be a difficult time for Opposition Members, because for so many years, this was the time of year when they were preparing for their conference and for the Budget, but this year, scant attention will be paid to them—and, of course, they are not writing the Budget anymore.

Thank God.

Indeed. Thank God the Conservatives are not writing the Budget, because we have seen what their Budgets led to. I understand Opposition Members’ frustration. It is nice to see that they have settled into the most comfortable aspect of being in opposition. As I have said before in these debates, as a Labour party member of many years’ standing, I have a huge amount of experience of the comfort of opposition; you start to create straw men, talk about what the Government might be doing and your fears, rile your supporters, and spark up a bit of concern among them. However, the Opposition are not willing to set out their actual plans for the country. [Interruption.] An hon. Friend makes a good point: they do not have any.

All the Opposition parties—again, this is the nature of the easy early years of opposition—want the benefits that result from our difficult choices, but they are unwilling to say how they would pay for them. I am sick and tired of listening to the never-never from those on the Opposition Benches. They are confident and comfortable with the imaginarium of the Budget that they believe will happen, but they are unwilling to come up with real, meaningful proposals—incapable of doing so, perhaps.

Proposals floated by the Conservatives include cutting maternity pay, means-testing the state pension and attacking the minimum wage. We know the impact of a Conservative Budget: the grotesque chaos caused by Liz Truss and Kwasi Kwarteng. I would call that Budget a bombshell, but bombshells go off only once, and that bombshell is going off in homes and communities across this country every single day. Families on mortgage rates that were fixed for five years or longer would have had lower interest rates now if it had not been for that Budget. Despite the five admirable and welcome interest rate cuts made under this Government, those families will be paying hundreds or thousands of pounds more a year.

Opposition Members express concern today for those in valuable homes. Many of those in valuable homes will understandably have significant mortgages, and many of them will have seen their mortgages go up by hundreds or thousands of pounds, thanks to the actions of the previous Government—actions that Opposition Members were cheerleading at the time. We are all still living with the results of those actions. That is not imaginary; that is the real consequences of their Government, and it is what we are trying to put behind us.

The Treasury has been flying more kites than we saw at the end of “Mary Poppins” in the papers over the last few weeks, but if they are genuine, the Chancellor is preparing the most destructive raid on homeowners in living memory. Families across my constituency are bracing themselves for new taxes on homes worth more than £500,000, capital gains tax on family houses, a revaluation of council tax, and even a land value tax. This is not reform; this is a sledgehammer aimed squarely at aspiration, mobility and stability, and once again it is the south and the south-east that will be punished the most. In Farnham, where the average house price now exceeds £608,000 with the price of detached homes at nearly £900,000, families could face annual bills of nearly £5,000 on top of mortgages, council tax and energy costs. In Haslemere, Liphook and Bordon, households will not be spared; these levies will strip thousands from budgets already stretched to the limit. And what of pensioners and downsizers in Grayshott, Churt, Bramshott, Tilford, or Frensham? They will face the grotesque prospect of capital gains tax on their primary residences.

My hon. Friend talks of pensioners. Does he agree that this is an extra pressure on them, following all the concern that was caused to them by the cut in winter fuel payments?

My hon. Friend is entirely right. Once again, the Government are showing that they do not understand and do not value pensioners and the sacrifice that they have made. Everyone—pensioners, farmers and business owners—is seen as a cash cow for this Government.

The Conservative Government raised taxes 25 times in the last Parliament. How many of those tax rises did the hon. Gentleman oppose?

I do not want to correct the hon. Gentleman, but I was not here to oppose or support any of them. I gently remind him—I use the word “gently” because I know that the Minister loves the word “gently”, so I have used it twice now—that there was a pandemic that had to be dealt with, and that had to be funded. There was a war in Ukraine, and dealing with that had to be funded. As we have gone back in history a bit, let me add that we also had to deal with the deficit that the last Labour Government left us. That is the reality of the situation.

Will the hon. Gentleman give way?

No, I will not. I have already given way a couple of times.

This is a tax on the family home, and it will hit hardest those who have worked hard, saved responsibly, and played by the rules. Let us be clear: this is not simply a question of numbers on a balance sheet. It is about whether families can stay in the communities where they raised their children, whether pensioners can pass on their homes, and whether young people will ever see the ladder of opportunity come down again. A capital gains tax on main homes will trap people in their properties, create a locked-in market, and dry up the supply of homes. Transactions will slow, chains will break, and first-time buyers—the very people whom Labour claims to champion—will be shut out even further.

The Government have tried to defend this agenda by talking about “fairness”, but there is nothing fair about a pensioner in Greatham being forced to sell his or her family home to pay the taxman. There is nothing fair about young families in Lindford choosing between childcare and a new annual property levy, and there is nothing fair about placing the heaviest burden on one region of the country simply because the value of its housing stock is higher. In truth, this is a south and south-east tax dressed up as national fairness; and it is part of a pattern.

From scrapping the pensioner fuel allowance, mentioned by my hon. Friend the Member for Bromley and Biggin Hill (Peter Fortune), to threatening VAT on private schools to punitive business tax rises, every single decision seems to be about sending a political signal rather than supporting families or growing the economy. The consequences are plain to see: falling business confidence, another year of negative hiring expectations, and growing unemployment. Wasn’t the Government’s White Paper meant to be called “Get Britain Working”? All we are seeing is Britain grinding to a halt. The Chancellor may talk of fairness, but she is stripping away the last sanctuary for working people—the roofs over their heads. Over-taxation, without clarity, will paralyse the housing market, punish my constituents, and undermine economic stability.

If you tax homes, you tax hope, and that is the surest way in which to drain ambition from our country. We should be protecting families, not forcing them to sell up. We should be supporting aspiration, not taxing it into extinction.

I think the record that we, the Labour Government, had to deal with when we took over last year bears repeating. We have heard theories propounded on the relationship between tax and growth and public spending, and we have heard that if we only lowered taxes, we would enter a glorious period of growth and even better public services, but the fact is that the impact of those theories and that ideology over the last 14 years has been clear to see. Austerity cut the engines of our economy, leaving us with public services that were not delivering for British people. Investment in our services and our country was cut, which left us at the mercy of global shocks that we were less well prepared and less well placed to withstand.

The upshot of that in my constituency has included GP waiting lists that are far too long, and bus routes disappearing from rural villages that badly need the opportunities they provide in, for instance, connecting families. We have seen NHS waiting lists increase, whether the waits are for serious surgery, dentistry or GP access. That has resulted in serious ill health issues, restricted opportunities for young people, and, throughout the constituency, a restriction of opportunity and growth for the very people who will drive growth in the economy: those who start and drive small businesses.

We have heard from Conservative Members again and again about the 1%, and they have come out fighting for that 1% very hard today. They say that they are concerned about yearly charges on people who are just starting out in life and have just bought their first homes—and yes, I would love to talk about charges that have no connection with service. I am thinking particularly of “fleecehold” and charges from estate management companies that bear no relation to the services that they provide. That is a real problem in my constituency, and I know that many of my hon. Friends have raised it repeatedly.

In Wingerworth, in my constituency, FirstPort has raised service charges repeatedly, but the charges are for services that my constituents have not received and have been imposed for very spurious reasons. I have also heard that some residents have been forced to pay for a play park when no such play park has been provided by FirstPort or any other company in the area. This means that people who are starting out—they have their mortgages, they have their homes, and they just want to get on and live their lives—are being subject to, in many cases, charges amounting to thousands of pounds each year by a company that is not delivering the services that they deserve, and the same problem is occurring elsewhere. We have heard horror stories of charges and ground rents rising exponentially. None of these problems— I think we can all agree that they are problems—were dealt with by the Conservative Government. I did not notice any particular concern being raised about them at the time. However, we will continue to fight hard for solutions on this side of the House.

Let us look at what this Labour Government have achieved since coming to office. We have seen real wages rising faster than prices for the first time for ages, and I cannot stress enough how important that is. Three million people have seen the minimum wage rise. This is exactly the sort of thing that led me to join the Labour party, and it is one of our proudest achievements. We are seeing a rise in the wages of the very poorest in society, including those under 21 who are starting out in their very first job. Let me highlight another of our massive achievements. We in the Labour party believe that taxes are what we take to ensure that we can deliver public services. Lower taxes and lower public services will not result in a rise in living standards. Yes, we have had to make some difficult decisions, but we have seen NHS waiting lists fall month after month, and I know that my constituents have already begun to feel the effects of that. Why? Because they have told me so.

I begin by referring the House to my entry in the Register of Members’ Financial Interests.

I represent a rural, agricultural community. As we look forward to a Budget for Christmas, this Labour UK Government’s last autumn Budget remains of significant concern. The wide divide between rural Wales and Westminster was made clear as day last year when the Chancellor announced plans to restrict full inheritance tax relief from April next year to the first £1 million of combined agricultural and business property. Combining APR and BPR means that the asset value of the tools and the machinery necessary to operate a farming business are affected, as well as the agricultural land and property.

While the Government maintain that this policy will affect only about 500 estates a year and that small family farms will not be affected, the calculations of the Farmers’ Union of Wales and NFU Cymru show otherwise. When I told the Minister for Food Security and Rural Affairs that 92% of one local accountancy firm’s clients would be hit, it was totally dismissed, but now even the producers of the research used by this Government to justify their plans have conceded that working farmers are more likely to suffer under the policy than the wealthy.

Over half of UK farms have a net value of over £1.5 million. Farmers are already worried about the family farm tax and are now looking at the potential tax rises that the Government are floating for the upcoming Budget, including increased rates of inheritance tax and other forms of property taxes. These are our food producers, and they are writing to me to ask why they should continue to sow the seeds. Does the hon. Lady agree that farmers need a break?

Absolutely, and I will come on to that in a minute. In Wales, between 75% and 90% of farmers will be affected by the policy, according to NFU Cymru and FUW.

It is clear that this Government’s APR changes will not hit tax-avoiding wealthy land hoarders. Instead, they will punish working farmers in Wales, whose income dropped by an average of 34% last year, forcing many to sell what their parents and grandparents spent lifetimes building. And it is not just farm business owners. Family Business UK estimates that the changes will cause a £15.5 million reduction in GVA in my constituency of Caerfyrddin alone, along with the loss of 282 full-time jobs.

The new inheritance tax rules will be introduced amid mounting financial pressures on our farmers, from the financial implications of bluetongue restrictions and testing requirements to the effect of Wales’s hottest summer on record on crops and pasture. Our rural businesses will also suffer, with car garages, food wholesale businesses and uPVC project businesses among those in my constituency that are hard hit by this Government’s BPR changes. All employ hundreds of my constituents.

We cannot afford to lose our rural businesses or our family farms. We cannot lose the knowledge, the heritage and the community—the work that sustains and feeds our nation. Ahead of the autumn Budget at the end of November, I call on the Government once again: please reverse these changes before it is too late. Diolch yn fawr.

It is a pleasure to be called in this debate, even if I must start by questioning the wisdom of the Opposition’s decision to bring forward today’s motion. After all, the memories and consequences of their so-called mini-Budget are still fresh—the culmination of Liz Truss’s economic policies, which the present Leader of the Opposition said were “aspirational and inspirational”. Their dreams became our constituents’ nightmares—to say nothing of the Conservatives’ failure to pass renters’ rights reform, which this Government are now putting through, or of their dreadful record on wages, which left people in my constituency with £300 a month less, after inflation, every month.

It cannot be reasonably denied—although the Conservatives have tried—that the incoming Government faced a bedevilled inheritance last July. For all the sound and fury, there is little mystery about this now. As Richard Hughes, the chair of the OBR, told the Treasury Committee:

“When we had a high-trust relationship with the Treasury those things were being well managed, and managed within the total. That system very clearly broke down… there was about £9.5 billion-worth of net pressure on Departments’ budgets, which they did not disclose…which under the law and under the Act they should have done.”

What a disgraceful set of affairs, and decisions that awaited the Government on public sector pay had been ducked and delayed until after the election.

We need to be clear about this: Conservative Ministers already knew the recommendation of the schoolteachers review body. They also knew that the recommendations of each pay review body tend to be similar. Why were those recommendations delayed, given that the pay year started not in July or even at the beginning of the pre-election period, but in April? It was because Conservative Ministers and their Departments submitted the remit letters and their evidence late.

As the Office of Manpower Economics said in its 2022 efficiency review:

“The work of the PRBs is demand led and essentially non-negotiable—departments set the remits and timetables.”

There we have it: the additional cost was always coming, and the only reason why it came seven months into an election year was because Conservative Ministers were content for it to be so delayed. Today Opposition Front Benchers claim that they would have rejected the recommendations, but not once has any Opposition Member had the courage to say how much less they would have paid nurses, paramedics, teachers, police officers and armed forces personnel in each of our constituencies.

Are any Opposition Members able to enlighten us today? No. The reality is that they want the investment that means 25,000 fewer people are on a University Hospitals Birmingham waiting list compared with last year, and which is almost doubling the free school meals entitlement in my constituency of Birmingham Northfield, but they do not support a single measure to pay for it. We should be clear in saying that strong public services create value. Businesses and working people in all our constituencies need roads, schools and hospitals that are resourced and decent.

As the hon. Member represents Birmingham Northfield, does he believe that residents in Birmingham deserve to get their bins collected in return for their council tax payments?

The hon. Member tempts me to get drawn into a discussion to which, in one minute and 30 seconds, I do not have enough time to do justice. Of course we need a bin service that is fit and decent—I have spoken about that many times in this House.

What my constituents did not need were the sharpest cuts in resourcing of any unitary authority in the entire country, coupled with the sharpest increases in council tax, and those were signed off by Conservative Ministers. I have in front of me the impact assessment of the 10% council tax increase from January last year, which says:

“The decision for Ministers across Government, as No. 10 and HMT clearance will be needed, is whether to grant these increases.”

That is the legacy of the hon. Member’s party for my constituents: the highest spending cuts and the highest tax rises. The last thing they need is a return to the failed approach of the Conservatives, who deserve to be reminded of that every time they bring such a debate to this House.

This Government were elected on a manifesto to increase spending by £9.5 billion. That was to be paid for through £7.3 billion of extra taxes and £3.5 billion of extra borrowing, all of which was set out in the Labour manifesto. It was a modest plan with a prudent margin—exactly the sort of plan one might expect a party in opposition to put forward to show that it can be trusted to run the public finances. Labour Members might reflect on the fact that had they implemented the plan, the British economy would be in better condition than at present.

In its first Budget, Labour increased public expenditure not by £9.5 billion, but by £70 billion. How those on the Labour Benches cheered with delight at the thought of all the extra spending: pay rises for train drivers, with no conditions; pay rises for junior doctors, with no strings; money for Great British Energy; and more money for the British Business Bank—all so the Government can invest in projects that the private sector does not think will make a return.

We all know how this story ends: Labour will use all the business acumen that the Cabinet has at its disposal to create a modern version of British Leyland. It is what Labour does best: spending other people’s money, and borrowing yet more money that other people’s children can repay. But all this extra spending and borrowing comes at a price, and the Government are now paying 5.7% interest to borrow money for 30 years. That is the highest level since 1998, and this surge in borrowing costs reflects the market’s lack of confidence in the Chancellor’s ability to manage Britain’s finances.

Does the hon. Gentleman accept that the surge in borrowing costs actually started with Liz Truss’s mini-Budget and has not really stopped since the trajectory started?

I do not accept that at all. This surge is entirely due to the Chancellor losing control of public expenditure, and the increased cost of servicing our national debt adds further pressure on the British taxpayer.

Having presented her Budget, the Chancellor said:

“We’re not going to be coming back with more tax increases, or indeed more borrowing.”

The problem is that no one believes her. The markets do not believe her, and Labour Back Benchers certainly do not believe her. They now know that they only have to threaten to rebel on any item of public expenditure and the Chancellor will cave. We saw that on the welfare reform Bill, which was brought forward to save a modest £4.5 billion. What happened? The first whiff of a rebellion, and the Bill was gutted, leaving the taxpayer to pick up the cost.

In that context, over the summer we saw briefings from the Treasury testing the water on a whole series of potential tax rises: higher rates of council tax, a land value tax, capital gains tax on family homes, lowering the thresholds for inheritance tax and an annual property levy on the family home. No wonder the Deputy Prime Minister is being so careful about which of her many homes is her primary residence.

The Chancellor is clearly desperate to raise more money. It is a cruel irony, is it not, that having invented a £22 billion black hole to justify her taxing and spending, the Chancellor now finds herself facing a black hole entirely of her own making? It is her jobs tax and other tax rises that have caused the economy to slow and unemployment to rise. Her increase in public expenditure has fuelled inflation, which has led to higher wage demands and increased benefit costs.

That is exactly the problem. Many businesses in my constituency—and, dare I say it, in others—are saying to us as Members of Parliament that they want to but dare not invest in growing their businesses, because they do not know what increases in taxes are coming down the line from this Chancellor. Does my hon. Friend share my concern that businesses are reluctant to invest right now in the projects they want to deliver for the growth of their own enterprises?

I agree. It is the threat of higher taxes that is causing the economy to stall.

Rather than reducing the size of the state so that it is affordable, the Government give every indication of wanting it to grow further. The fundamental reason that this Government need to raise taxes is that they are incapable of controlling the fiscal incompetence of their own Back Benchers. At their core, Labour MPs genuinely believe that the state can spend our constituents’ money better than they can spend it themselves. They do not believe in thrift or self-reliance, and they see no limit on the size of the state.

Opposition Members know that it is businessmen and businesswomen across Britain who create wealth and growth. Success is the result of hard work, taking risks, satisfying customers and employing neighbours. The Government should provide the environment for those businesses to thrive, rather than threatening every part of the economy with higher taxes.

As my hon. Friend the Member for Gateshead Central and Whickham (Mark Ferguson) pointed out, the motion we are debating is based purely on media speculation. It also conveniently overlooks the Conservatives’ own disastrous record. Let us not forget that it was the Conservatives who presided over 14 years of failure, during which the very foundations of our economy rotted away. It was on their watch that taxes were increased 25 times in the last Parliament and the costs of mortgages soared, crippling family finances across the country.

We have heard Conservative Members talk about covid, and Russia and Ukraine—and some even seem to acknowledge the travesty that was Liz Truss. However, a 2021 report from the cross-party Treasury Committee highlighted that the OBR had been warning since 2011 about an “unsustainable” fiscal trajectory in the public finances, although the Government failed to engage with that fact. Who was the Chair of the Treasury Committee making that shrewd analysis? It was of course the current shadow Chancellor. Before we got to Russia, covid and the disaster of Liz Truss, the Conservatives had already been mismanaging our economy.

Now the Conservatives come to this House to complain about a Budget that has not even been written, offering no credible economic plan of their own and continuing to make unfunded promises. This Labour Government took immediate emergency action to stabilise our economy, and made difficult but absolutely necessary decisions. We are already seeing the early signs of promise: wages are now rising faster than prices; we have had five interest rate cuts, bringing down the cost of mortgages; and we have secured three major trade deals.

The hon. Member and a number of his colleagues have referred to the reduction in interest rates as the sign of a growing economy. If he even googled it, he would realise that the first explanation for the Bank of England reducing interest rates is that it is worried about a weakening economy. Does he not realise that?

The foundation for being able to cut interest rates is a stable economy, and that is exactly what the Bank of England has done.

We are putting more money directly into people’s pockets, lifting the minimum wage for 3 million workers and delivering free breakfast clubs for all primary school pupils. We are getting Britain building again by reforming the planning system to cut through red tape, bringing in hundreds of new planning officers and making a record investment of £39 billion in affordable housing. We are committed to building 1.5 million new homes, so people are not locked out of the dream of home ownership. We are correcting the mistake of successive Conservative Governments with the crucial £113 billion in extra capital investment right across the country to boost our infrastructure and catalyse high-growth sectors.

Crucially, we have had to make difficult but fair decisions on taxation—decisions that ensure that the richest and larger businesses pay more—because we urgently need to invest in the public services that the Conservatives ran into the ground. That means vital investment in our NHS, schools and other essential services that all my constituents tell me we need. It is only because of the revenue measures applied by this Government, which the Conservative party repeatedly opposed, that we are able to make that investment.

As many others have said, the Opposition parties want all the benefits of our difficult choices, but refuse to say how they would pay for them. They talk about growth, but they consistently attempt to block measures to get our country building and they have been holding our economy back for far too long. As the Prime Minister and the Chancellor have said, the next phase of this Government is singularly focused on making working people better off, improving living standards across the entire country, boosting British jobs and delivering the renewal that our country desperately needs. We will not be swayed by Opposition motions based on their fantasies, or by those who offer no credible solutions themselves.

I have been told that we are speculating today, so I do not know whether I have to refer to my entry in the Register of Members’ Financial Interests. However, in an abundance of caution, I declare that I am a homeowner and I also have properties for rent.

The kids in Downing Street—whether in No. 11 or No. 10—think it is clever to fly kites about tax rises. We had it last year, from 4 July onwards, with briefings to the press saying there would be tax rises because of a wholly fabricated £22 billion black hole in the economy. That was fabricated as a fig leaf for tax rises that were not in the manifesto. From July to October, those stories dripped in one after the other—and what was the impact? It has been the collapse in business confidence to pandemic levels, the collapse in consumer confidence as a result, and unemployment beginning its inexorable rise month after month for every single month that this Government have been in office.

Now the Government are at it again. They have not realised their past terrible mistake, and they are doing it once more. Despite raising taxes by £40 billion last October and increasing borrowing by another £32 billion, they have created a genuine black hole, which the National Institute of Economic and Social Research suggests means that about £51 billion is required in higher taxes or lower spending. The briefings have started again—a property levy on mansions, the replacement of stamp duty with a national property tax, national insurance contributions on rental income and capital gains tax on primary residences with a value of more than £1.5 million. Even Which? magazine has said there may be changes to the in-life gifting regime to reduce inheritance tax.

Does my hon. Friend accept that speculation about all those new additional taxes causes more uncertainty, which itself causes the economy to slow further?

My hon. Friend is absolutely right. Do the Government not recognise that posturing from the Government Benches does not come for free? Construction activity has had a bigger fall recently than in the last five years due to the leaks from No. 10 and No. 11. The commercial property sector is in recession. There are hiring freezes and staff are being laid off. People are losing their jobs because of the Government’s kite flying. Residential property prices had a surprise fall last year.

We are asked to believe that growth is the No. 1 priority of this Government. They say they are going to build 1.5 million houses during this Parliament. Merely saying that does not make it true, when their policies serve to do exactly the opposite. If Members do not believe me, look at the markets—they are not politicians. Look at the 30-year gilts that the Government are paying today. Government debt is now running at 5.73%. That is the highest rate this century. The markets think that further tax increases will damage growth. That means they will damage the fiscal environment in the future. We will have less tax in the future because of the tax-raising decisions the Government are apparently going to take in November. Labour is planning, literally, to rob Peter to pay Paul. This is no way to run an economy.

As someone much more famous than me once said, the problem with socialism is that you eventually run out of other people’s money. Stop now. Stop before it is too late to avoid a vicious debt spiral. I fear—I genuinely fear this—that the Government will be forced to cut spending. They have two options: they can be forced to do so by the markets in a chaotic fiscal event, or they can take the responsibility of government seriously and take the difficult but necessary decisions on spending that the country needs them to take as a responsible Government. Otherwise, they will be swept away by their own incompetence.

I rise to speak against the motion on tax. I welcome the Chief Secretary to the Treasury, my hon. Friend the Member for Ealing North (James Murray), and his well-deserved promotion.

We all know that if we share in growth, we make the country more prosperous and we make it stronger. Tax, of course, helps to pay for the investment that makes us all more prosperous. Under the previous Government, we did not invest in our country and we saw a weaker nation as a result: the highest energy bills in the G7; the worst waiting lists ever seen in this nation; and the worst transport infrastructure in western Europe. That is what this Government are fixing and that is what we are doing with the taxes we have raised.

The Opposition motion speaks of property taxes—this from the party that dashed the dream of home ownership for my generation. Some 40% of those under 30 live with mum and dad. Young people living in big cities pay 40% of their income on rent, unable to save for a house because of the amount they are paying in housing costs. That is precisely the kind of thing we are fixing when we invest to build social housing—£40 billion-worth. But of course, all that needs to be paid for and that is exactly what we do with the taxes we raise. That is why we are proud of the country we are building, where every single one of us is better off.

Crucially, the taxes we raise follow three principles: that they are progressive, raising more from those on higher incomes than from those on middle and low incomes; that they are growth enhancing, both in the way that they are applied and in the investment they pay for; and that we can implement them easily. Those are the three principles that our taxes faced in the autumn: closing a non-dom loophole for those at the top of society; asking the largest businesses to pay more, so we can reduce our waiting lists; and increasing the taxes on second homes, so we can build homes for every single person in this nation. The revenue raised from those who can most afford it makes each one of us better off—that is what this Government are about.

The Opposition want to leave us with a nation where we are weaker: where we do not invest in our collective prosperity, as they did not for the last 14 years; and where we see, instead of a nation that is united and sharing in our prosperity, one that is divided. A house that is divided against itself cannot stand and a nation that is as divided as ours will not stand. It is for us to invest in every corner of this country, so that every person can benefit. That is exactly what we are doing in our economic programme and that is exactly the kind of investment we are paying for through our taxes.

We build a stronger nation when each of us shares in our prosperity, and we help to achieve that through our tax system when we invest to get wages rising, waiting lists down and energy bills down—a stronger nation where each of us is doing better, raising living standards that for too long have been far too low, helping people to be able to afford a home, helping them to raise a family, helping them to pay their bills without having to worry about their overdraft, and sharing, each of us, in our nation’s prosperity. That is what this Government are doing, that is what we are building and that is what we are proud to be a part of.

Here we are, well over a year into this new Administration, this new Labour Government, and it is clear that they have fundamentally mismanaged the economy in their first year in office. What do we see? Borrowing costs up, growth flatlining, taxes rising and businesses being absolutely hammered. To fix this mess to the tune of £50 billion—who knows what it might be—Labour is now threatening to hike taxes on anyone they have not already squeezed into submission.

It is clear that the Labour Government are coming after people’s property. It was not enough for them to legislate to compulsorily purchase people’s gardens and homes by giving local authorities and Natural England more power through the Planning and Infrastructure Bill, and to acquire them not at market value, but at a disregarded value relating to agricultural property value if they are a farm. If the Government do not manage to grab it, they certainly intend to tax it.

As if that tax on people’s homes or gardens was not bad enough, Labour is also coming after people’s businesses. Through the changes to inheritance tax relief, agricultural property relief and business property relief, the Government have destroyed one of the sole business environments that our communities and businesses rely on—the ability to pass an asset on to the next generation and for them to earn an income from it. Across my constituency, soft furniture makers such as Fibreline, brewers, farmers, hotels and those involved in the hospitality sector have all actively taken the decision to slow the amount of investment they are willing to put in to grow their own businesses. Why? Because of the threats coming out of the Labour Government’s previous Budget in October last year and the Budget coming down the line.

My hon. Friend is making a powerful speech. He mentions the hospitality sector. Does he recognise the Government’s cruel decision to reduce the business rates discount for the hospitality sector from 75% to 40%? It does not sound too bad, but it is actually a tax increase of 140% on the struggling hospitality sector. What impact does he think that has on future investment plans?

My hon. Friend makes a valid point. Many of our family businesses, whether in the hospitality sector or in other sectors, are actively withholding a level of investment in their businesses which they want to grow and thrive. I have spoken to many farming businesses and many family businesses in my constituency who have worked out what their BPR or their APR liability is likely to be over a 10-year plan, and are therefore holding the level of investment back, because they may have to give it to the Chancellor and not invest it for the future growth of their business. That is not good for the health of the communities and businesses we represent.

Then there is council tax, with the looming threat of council tax revaluations potentially coming down the line, raising the council tax liability on many constituents, with properties potentially moving into higher tax bands. Bradford residents, who include those in Keighley, Ilkley, Silsden and the Worth valley, have already had our council tax raised by 10%. This threat is being added by the Labour Government when council tax is increasing. And then there is the cut to business rates relief, which is impacting many of our businesses.

With the threat of a revaluation process coming down the line, I want to raise the case of the Valuation Office Agency. Just this morning, I spoke to the Rock family, who have developed Providence Park in Keighley, with a huge amount of public funding going into the project. Despite the project completing its construction phase in April, they are now being told that despite an application being submitted, the valuation office is not even progressing with providing the business rate liability. It will therefore be more difficult for the Rock family to let those business premises. What is the Minister doing right now to put pressure on the valuation office to get a grip, pull its finger out and get those rates looked at, not just for Providence Park, but for the many businesses up and down the country that are struggling to get understanding from the valuation office?

This debate is about property taxes. We know that the Government have indicated that they are going to come for property owners in the Budget that is coming down the line—they indicated it in the previous Budget through the changes they made to inheritance tax. The Government must change course for the health and the good of the economic prosperity of our country.

Like my family and friends and the people of my city, I saw at first hand the economic failures and harms done to the people of this country under 14 years of the previous Government—harm to our council services, armed forces and public services, the special educational needs and disabilities system, NHS waiting lists, rents and mortgage costs, wages, prison place numbers, police numbers and safety on our streets. It was 14 years of made-up unfunded promises and commitments—14 years in which the previous Government gave up on Pompey, on Britain and on everyone in it, leaving us as a Government to clear up their mess. Fourteen years cannot be cleaned up overnight—it takes time—but, Madam Deputy Speaker, cleaning it up we are.

I welcome the investment in my constituency, including £13.8 billion for flood defences to protect our homes; £2.2 billion for the defence sector, which will protect jobs in my city and provide greater opportunities for our small and medium-sized enterprises; £4.8 million for better buses, allowing better transport; £2.7 million on fixing potholes to repair the crumbling streets we live on and stop the damage being done to our vehicles; £2.3 million for upgrading schools and college buildings so that our young people have a safe environment to learn; £1.9 million in additional SEND funding to start the process of patching up the mess, which the previous Government said was a lose-lose situation; and £1.2 million in additional funding for temporary accommodation to house some of the most desperate families in my city. We are seeing investment into solar panels on public buildings to reduce costs and protect the environment, safer streets programmes in North End and Cosham, in addition to named police officers, as well as free school meals and breakfast clubs to support pupils.

I just want to pick up on the hon. Lady’s point about free school meals, because these meals are not free. I spoke with a school in my constituency just last week that has been mandated to provide these so-called free school meals. However, the meals are having to come out of the school’s own budget. Can we change the narrative associated with the rhetoric that this Labour Government are putting out?

As a former teacher, I say no. I will continue with the term free school meals.

We are also seeing breakfast clubs to support pupils and families at the start of every day, additional nursery allocations to help working parents with the crazy cost of childcare, and investment in our NHS. All of those measures are the result of having a Labour Government and two Labour MPs in Portsmouth. I could go on, because that is just the tip of the iceberg of the investment and initiatives that are very much needed by the people of my city. This is reality, not imagination, speculation or politicking—not, in the words of the motion today, “considering”, but action.

None of that would have been possible without the decisions of this Government. Some, I admit, have been difficult, and some have been very necessary, such as placing the burden of tax on the very wealthiest, with private jet tax up 50%, stamp duty on second homes, changes to inheritance tax on big landowners, the scrapping of non-dom status, the ending of offshore trusts to stop inheritance tax avoidance, and VAT on private schools. Does the Minister agree that the investments like those in Portsmouth North are possible only because of the decisions and actions we have taken to raise revenue?

Those decisions, Madam Deputy Speaker, were repeatedly opposed by the Opposition. In bringing this debate, which is—in the words of Willy Wonka—one of “pure imagination”, they appear not to be considering an alternative, but to be going back to the status quo of 14 years of cuts and damage to Britain. This debate has been full of amnesia and sloping shoulders, with no regret and not one apology. It is a debate set to talk Britain and its people down—a debate ignoring the most positive things this Government have brought to the people of my city and this country.

For the final contribution from the Back Benches, I call Melanie Ward.

Here we are, with another Opposition day debate and another tedious motion from the Conservatives that completely ignores the catastrophic economic inheritance they left for this Labour Government coming into power. Their decision to put Liz Truss into Downing Street is something they will never quite live down. It really does stick in the craw to be lectured on sound economic management by them. We have had some fine examples of that today, with the hon. Member for Bridgwater (Sir Ashley Fox) stating his belief that speculation about future measures damages the economy. Why, then, have the Conservatives today put down a motion that is entirely about speculation? It makes no sense, even on their own terms.

In government, the Conservatives did untold economic damage to the UK’s public finances, and the Chancellor is right to prioritise investment in our infrastructure and public services while ensuring sound economic management. The Conservatives talk of wanting to put more money in people’s pockets, yet they presided over the worst pay growth of any Government for a century. Had the Conservatives—and, we must not forget, the Liberal Democrats for a while—grown wages between 2010 and 2024 at the same pace as the previous Labour Government, the average worker would be £117 a week better off. [Interruption.] Opposition Members may heckle, but that is real money that could be in my constituents’ pockets which is not because of what their Government did.

It is this Labour Government who are putting money back in people’s pockets. Our increase to the national minimum wage means that wages are rising faster than prices, and 8,000 low-paid Fifers this year received a pay rise, including thousands in my constituency of Cowdenbeath and Kirkcaldy. Let us not forget that the Leader of the Opposition said that the minimum wage is a burden and that maternity pay is excessive. It is the Labour Government’s stewardship of the economy that means interest rates have fallen five times and average mortgages are now £1,000 a year less than when the Conservatives were in power. Again, that is real money in the pockets of my constituents. My constituents know that it is this Labour Government and this Labour Chancellor who have prioritised Kirkcaldy for multimillion-pound regeneration funding as part of the growth mission fund, beginning the transformation of our town centre, which was neglected for a decade and a half by the Tories, and for almost two decades by their enablers in the Scottish National party.

The old cliché that to govern is to choose is correct. All politics is about choice, and the difference between this Labour Government and the Opposition is that we have chosen to invest in our communities, in our public services and in increasing economic activity and wages, after they failed to do so under five Prime Ministers and seven Chancellors.

We now come to the wind-ups. I call the shadow Secretary of State.

Before I get into my speech, I genuinely welcome the Exchequer Secretary to the Treasury, the hon. Member for Chipping Barnet (Dan Tomlinson), to the Treasury Bench and to his position in the Treasury. I give the House due notice that I do not intend to take interventions; the hon. Gentleman will have a tough enough job defending the indefensible as it is, and I do not want to curtail his time any more than I strictly have to.

The Labour party loves tax, and that has been on display in the Chamber this afternoon. When given the opportunity, Labour has been very critical of us. It is only fair to say that in government we did put up taxes more than we would have wanted. However, I do not remember Labour Members criticising our expenditure when we were supporting businesses and individuals through furlough; I do not remember them criticising our decisions to support people with their fuel bills in response to Russia’s brutal invasion of Ukraine. Labour likes the spending when it comes.

A number of Government Members stood up and criticised us for putting up taxes—a bold move, bearing in mind that that is exactly what they are going to do later on this year. If I am wrong in my estimation, if I have been unfair, or if I have mis-categorised the heart and soul of those on the Government Benches, I will break the rule that I made just a moment ago and take an intervention from any Government Member who is willing to stand up and say that they want to see taxes coming down—I thought not.

No, I will not give way. The hon. Member had his chance.

This is the point: the Government love putting up taxes. We in the Conservative party put up taxes when we had to; this Government put up taxes at every chance they get. And the reason they put up taxes whenever they get the chance to do so is that they think taxes are not a necessary evil, but a good in and of itself. That is at the heart of the problem. The fact that gilt markets, bond markets, businesses and individuals know in their heart of hearts that taxes will go up under this Government has produced the stagnation and the stifling that Labour Members are criticising.

I was about to say that we have had a number of good contributions from both sides of the House, but that is being generous. The simple fact of the matter is that a key indicator of confidence in a Government is the cost of borrowing, and, currently, that is at a multi-decade high. As we have said, it has not been higher this century; it is trending in the wrong direction. The Bank of England, when setting interest rates, made it clear that it is concerned about the trajectory—specifically the trajectory on property taxes. Those on the Treasury Bench say that they do not want to speculate on what might be in the Budget later this year. They did not want this House to investigate what they claim to be speculation. They probably should not have spent so much time briefing the media over the summer. They cannot have it both ways. We are asking legitimate questions of the Government, because the markets and the country are worried about what is happening and we want to allay their fears.

Will my right hon. Friend give way?

No, I will not give way.

Let me just say this: if we are to address the slowing of the housing market, we should make sure—[Interruption.] I say “we”, but Labour is in government now and it should therefore make sure that it does nothing to stagnate the market further. Speculation is rife that there will be a £14,000 tax bill on average for UK households, a £23,000 tax bill for those in the south-east, and potentially an average tax bill of £33,000 for property transactions. That is the Government’s fault. They have the opportunity to put that speculation to bed and they choose not to do so. Despite the fact that they are now in government, they do not seem to have learned the lesson that when they speak—whether it be on or off the record—markets move. That is why speculation among those on the Government Benches is so damaging and so dangerous. They are causing economic problems because of their kite flying. We have given them an opportunity to put one of those pieces of speculation to bed and they have failed to do so. In that failure, the mask has slipped—they want to put up taxes. They love putting up taxes and they are going to put up taxes.

I call the new Minister.

I thank the shadow Secretary of State for Housing, Communities and Local Government for bringing the debate to a close for the Opposition and for the welcome that he has given me as I move down to the Front Bench. I also thank my right hon. Friend the Chief Secretary to the Treasury for his speech and congratulate him on his promotion to Cabinet. He was a fantastic Exchequer Secretary, and I will do my best to carry out the role with the same diligence and effectiveness.

I also wish to put on record that, although I may be standing at the Dispatch Box for the first time, my respect for this place and for the Members on both sides of this House and on all Benches will remain. The Commons, after all, is the heart of our democracy. The importance of Ministers being held to account and of MPs voting and debating on big issues—and on Opposition Day debates—and, crucially, of the public being able to hold us all to account will never diminish in my mind. I look forward to continuing to work constructively with Members from all parts of the House as we discuss and debate the important and very interesting topic of tax policy.

Under the leadership of the Chancellor and the Prime Minister, this Government are turning the page on 14 years of economic mismanagement. We must and we will put an end to the years of sluggish economic growth and squeezed living standards—issues that have typified the past two decades. We must turn this country around and build an economy that works for everyone.

I welcome my hon. Friend to his new position, which is hugely well deserved. This motion gives the impression that the Conservatives care about homeowners and renters, but does he agree that it is Labour who are giving homeowners greater powers and protections through leasehold reform, giving renters stability so that they can stay in their homes for longer, and building 1.5 million more homes to tackle the terrible housing legacy of the previous Government? They did too little and we are sorting it out.

I thank my hon. Friend for that very kind intervention. I agree with every word that he said.

The subject of today’s debate is, of course, taxes and which taxes may or may not change in the future. Let me be clear: I will not be writing the Budget today or any day in this role. That is a job for the Chancellor. Just as she delivered a Budget that fixed the foundations for the country last year, I am confident that the Budget this year will showcase the right choices for the country for the long-term health of public and family finances.

Property taxes make a significant contribution to the public finances, raising more than £75 billion a year. That is crucial for funding our schools, our NHS, our emergency services and our armed forces and for filling in potholes too. They help to provide a broad tax base, which underpins good fiscal policy. I know that that is not something to which the previous Government gave much thought. They were happy, it seemed, to run our economy and public finances into the ground, leaving us with a £22 billion black hole, which we of course had to fill.

We believe in a tax system that is fair and sustainable and that supports economic growth. At the autumn Budget in 2024, my right hon. Friend the Chancellor took a number of decisions to raise taxes on the wealthy to help fix our public finances and support public services such as the NHS and education. These tax changes included: abolishing the non-domicile tax status; raising the rates of capital gains tax; limiting inheritance tax reliefs; and increasing air passenger duty for private jets. Thanks to the work of my predecessor and the great work of HMRC officials, whom I am looking forward to working with, we are also increasing work to make sure that the wealthy pay their fair share of the tax that they owe. These changes and others that we have made demonstrate the fundamental truth of politics in 2025.

I congratulate the hon. Gentleman on his appointment. In the Labour manifesto on which he will remember he stood along with his colleagues, it was suggested that there would be tax rises under a Labour Government. I think the figure was £7 billion. In the event, £40 billion-worth of rises came forward in the autumn. Will he commit the Government to being more transparent in future in preparing the markets for tax rises, and, indeed, the people who have to pay them?

I thank the right hon. Member for his intervention. I would ask him if I could whether he could identify £40 billion of spending cuts, if he wants to have £40 billion of tax cuts. I do not want to see NHS waiting lists grow in my constituency, in his constituency, or in any of the constituencies that we all have the privilege of representing.

The tax changes that have been introduced demonstrate the fundamental truth of politics in 2025. The bedrock of this Labour Government is fiscal responsibility, while the cornerstone of the Conservatives’ economic plans is fiscal fantasy. It is simply incredible that they have opposed every single one of the tax increases that we have put forward. Willing the ends without having any of the means is coming to define the economic policy of the Conservatives. Frankly, it should concern us all how unserious they have become. As my hon. Friend the Member for Gateshead Central and Whickham (Mark Ferguson) said, it is clear that the Conservatives are enjoying the comfort and ease of opposition. Long may that continue.

I must say, it is surprising that the Conservatives would wish to raise the subject of property, given their abysmal record in that area. There can be no doubt that a big part of the mandate that this Government were given was to build more homes. The public had grown weary of years of sluggish growth, and over-budget projects that were first stalled, and then delayed. The public needed change; they needed us to build for this country’s future, and that is what we are setting about doing.

From infrastructure to planning reforms, which I have been championing for the last year, and our mission to build 1.5 million new homes. The Government have put housing at the heart of our approach, which will create jobs and opportunities for those who build the homes, and give families and individuals the opportunity to call somewhere home. As I said when I gave my maiden speech from a few rows back, housing is central to my politics. The aspiration of everyday families up and down this country is to have a home to call their own, maybe with a garden and a spot to park their car, in a community supported by public services that work. People do not want the world delivered to them on a plate by Government. They just want a good life for themselves and those they love. Building more housing and improving public services are essential ingredients of meeting their aspirations.

I have made many notes on all the fantastic contributions from Members on both sides of the House, but I can see that Madam Deputy Speaker thinks that it is almost time for me to conclude, and I am sure that the Opposition Whip thinks so. [Interruption.] Ah, it turns out that there is more time, so I shall begin with my hon. Friend the Member for Milton Keynes Central (Emily Darlington), who made a powerful intervention about the success of Milton Keynes city council, and the importance of this Government investing in public services.

The hon. Member for Bromley and Biggin Hill (Peter Fortune) gave a powerful example of house prices in his constituency, showing how prices have surged in this city—I know that, as I represent a north London seat—but that is why we must build more homes. I hope that he will support all the planning reforms going through this House, and the reforms that will come soon, because we need them to bring down house prices and improve the living standards of people in this country.

The hon. Member for Farnham and Bordon (Gregory Stafford) made an interesting and thoughtful intervention about support for pensioners, but he should talk to the shadow Chancellor, the right hon. Member for Central Devon (Sir Mel Stride), who has said that the triple lock is unsustainable—a view with which the Government do not agree. I would like to give a pleasant mention to my hon. Friends the Members for North East Derbyshire (Louise Sandher-Jones), and for Loughborough (Dr Sandher). I congratulate them on their marriage over the summer. It is fantastic to see them both contribute to the debate, and they both bring so much to the Labour Benches.

My hon. Friend the Member for Birmingham Northfield (Laurence Turner) had a very good line on Liz Truss. He said that her dreams became our constituents’ nightmares, which is very true. We know it, and I think the Conservatives do, too. I will certainly be stealing that line for future contributions in this House.

To conclude, as the new Exchequer Secretary to the Treasury, I look forward to returning to this Chamber and to Committee corridor on many occasions to discuss tax policy. The people of this country work hard for everything that they earn. They deserve an efficient and fair tax system, whether that tax relates to property or other areas, and for Governments to spend every penny of public money wisely. That is why everything we do is underpinned by fiscal stability, our sticking to our rules, and our managing the public finances well in this uncertain world. We do not turn to more borrowing, as Liz Truss did or the hon. Member for Clacton (Nigel Farage) would, but put economic stability at the heart of all we do. That is the foundation for what really matters: higher growth for higher living standards in every part of the country. That is what this Government are working every day to deliver.

We are working to lift the crushing burden of the cost of living crisis, to back those who want to invest in the future of this country, and to give as many people as possible a home that they can call their own. That is the future that I fought for on the Back Benches, and that is the future that this Government can and will deliver.

Question put.