How residents in Wales could face 60% in direct taxation.
The Budget is nearly upon us on the 26th November 2025.
Is there a need to be financially fearful? The answer, of course, is, “Yes” largely because we have socialist governments in Westminster, Cardiff and Monmouthshire.
Members are increasingly expressing their financial concerns to the Association; not just over the Chancellor’s likely raid on our incomes, pensions and investments but also over what is happening within devolved and local government.
Seemingly, somewhat under the radar, there are uncorroborated rumours circulating that suggest Monmouthshire’s Labour Cabinet is considering a 7.2% council tax increase next year, something that flagrantly ignores the moratorium in England on increases over 5%.
MORE COUNCIL TAX RE-BANDING IN WALES
Welsh Labour, calling it a “fairer and more progressive system” have already passed legislation to re-band properties in Wales from 2028 onwards with additional re-banding each subsequent five years. They say the process will be revenue neutral, however recent reports in the Daily Telegraph claim that, in reality, it is designed to create a 17% increased uptake in revenue for local government in Wales.
Either way, council tax bills in Wales will increase considerably on higher value properties in addition to most local authorities’ habitual annual increases.
WELSH LABOUR’S MANSION TAX
Wales is the only part of the UK that has, for council tax purposes, a Band I, sometimes referred to as Welsh Labour’s Mansion Tax. Properties valued at £424,000 or more in 2003 fall into this bracket, not a particularly high threshold for a largely rural area like Monmouthshire.
But it is not just those in Band I that have been affected. Its mere existence means that many other properties have been shuffled up into a higher band compared to an equivalent English local authority.
DOUBLE TAXATION?
Labour’s oft-heard soundbite that those with the broadest shoulders should bear the greatest burden is in danger of becoming seriously onerous.
With top end council tax bills in Monmouthshire at present in excess of £5,000 per year and having to be paid out of already taxed income, a property owner earning just over £50k pa needs to earn (before tax) approaching £10,000 pa just to pay their council tax bill. This amount could well represent 20% of their entire income. When this is added to the 40% they have already paid in income tax, a staggering 60% of income could, in theory, be consumed in paying these two taxes.
Is this Double Taxation? Strictly speaking, “No” because these taxes are different types of taxes levied on different things. But for residential property owners it increasingly feels like the answer is, “Yes”.
CONSERVATIVE IDEOLOGY
This level of taxation is entirely contrary to basic Conservative ideology. Conservatism seeks to improve the lot of everyone, whether rich or poor or, for most, somewhere in between.
Socialists are, of course, still wedded to their theory of the redistribution of wealth as demonstrated by their current “broader shoulders” rhetoric. But the redistribution of wealth phrase has poor connotations for Labour as it is associated with their failed policies of the 1970s. So today they are inclined to describe then as progressive policies or social justice. We, as Conservatives, feel they would be better described as wealth destruction policies.
Conservative ideology goes further and believes in wealth creation for the mutual benefit of the individual, the economy and the Exchequer. This wealth creation extends to the London money markets which are vital financial institutions for the health of the British economy.
Yet Reeves‘s policies threaten the very existence of the London Stock Exchange as one of the world’s premier money markets. Funds available for investment are reducing fast, indeed last month (October 2025) saw the biggest outflow of funds in a single month since the pandemic as people took flight over the possible consequences of the upcoming budget. This is shrinking the size of the market and causing companies to move their listings to other, overseas Bourses which further diminishes contributions to the British economy.
Misguided, she still maintains that greater public spending will create faster growth. This previously failed policy was characterised by Churchill as being like a man standing in a bucket trying to pull himself up by the handle.
Margaret Thatcher was even more scathing of socialism and never missed an opportunity to wage war against such a doctrine. No better example exists that her final PMQ’s as Prime Minister which is well worth a watch.
Click here to watch one of Margaret Thatcher’s finest Parliamentary performances, "Thatcher’s Last Stand Against Socialism".