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Ministers are now deeply immersed in the latest Whitehall anti-bureaucracy drive – an exercise described as an assault on ‘sludge'.Well, if ministers are serious about that effort, they should start by looking at the barriers that stand in the way of our broken system of council tax.It is almost a cliché at this point to say that council tax is unfair and that it is regressive, opaque and outdated. In the context of exciting developments at the strategic scale – integrated settlements, new tourism levies and even the promise of a pathway toward fiscal devolution of national tax – it is the decay and drift of the original local tax system that we cannot afford to ignore.But the problem runs deeper: England may no longer really have the ability to even reform council tax properly.Council tax is still built on 1991 property values. A system designed as a quick political replacement for the poll tax has become one of the core revenue pillars of the local state. It funds services that look nothing like they did three decades ago. It sits beneath adult social care – something we at Re:State recently called to end – children's services, homelessness, public health, prevention, neighbourhood services and the day-to-day functioning of local democracy.Yet the valuation base on which it rests belongs to another country – a pre-devolution, pre-austerity, pre-internet, pre-housing-crisis England.That is why council tax reform keeps turning up like a bad penny in the policy debate. And nobody so far has had the nerve to follow through. Revaluation will be politically painful. Any serious reform will produce as many losers as winners.Another, less discussed reason why governments shy away from the issue – the practical machinery of property valuation that makes reform feel so expensive and so difficult is that it is not deliverable.It is time for a long, hard look at the Valuation Office, now brought into HMRC after the abolition of the Valuation Office Agency as a separate executive agency. The stated aim of the move was sensible enough: reduce duplication, improve efficiency, increase transparency and bring valuations into HMRC's broader modernisation programme. It is now clear that this structural change needs to be only the beginning of far deeper reform.The planned new High Value Council Tax Surcharge is a limited reform, applying only to residential properties worth £2m or more. Fewer than 1% of properties in England are expected to be above that threshold. The Valuation Office will conduct a targeted valuation exercise, with revaluations every five years. Those I speak to in the civil service tell me the Valuation Office thinks this process alone will cost £150m. This implies that a much-needed full revaluation would cost hundreds of millions more.The Valuation Office is not some small back-office function. HMRC's 2024-25 annual report says there were more than 3,700 staff in the Valuation Office at the end of that financial year. By comparison, the Ministry of Housing, Communities and Local Government's (MHCLG) core department averaged 3,995 full-time equivalent staff.Valuation Office modernisation should be made an immediate priority. The public debate should not begin with winners and losers from hypothetical new council tax bands, but with the administrative capability needed to make a fair system possible.Critically, we do not have to rely on a single centralised process doing everything itself. Scotland uses local assessors, operating within a national system, with the Scottish Assessors' portal providing access to valuation rolls and council tax bands. Other countries embed property transactions in systems where public officials, such as French notaires, play a normal role in validating and recording property information.And then there is the example of the private sector. Banks routinely make lending decisions based on property valuations. Insurers, lenders, conveyancers and property platforms all handle large-scale property data. The State should not be less capable than the institutions it regulates.The question of our times is whether the State still has the operational capabilities to do difficult things well. Council tax reform is exactly that sort of test.Simon Kaye is director of policy and research at Re:State

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Council tax reform: Time to take a long hard look at the Valuation Office

By Simon Kaye | 10 June 2026

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