Regional mayors to receive share of income tax under Burnham plans

Andy Burnham has announced he will give regional mayors a share of income tax in a move he calls the biggest transfer of power from Westminster in a generation. The prime minister's plan allows English mayors to keep a share of the income tax and business rates collected in their area. He said: "Under our plans, more of the taxes raised in a community will stay in that community. Soon, every local leader will have the power and resources to improve public transport, build homes and create jobs." The full details of the reforms are expected to be announced in a white paper, published after Chancellor John Healey presents his first budget in the autumn. Burnham, who was the Mayor of Greater Manchester for nearly a decade, said: “I said we’d take power out of Westminster and carry it into every postcode in the country. “Today, we make good on that promise." Burnham was re-elected as Mayor of Greater Manchester in 2024 for a third consecutive term Credit: PA “I know what it’s like to be ignored by politicians in Westminster," he added. “I’m not going to make that same mistake now I’m PM." Subscribe for free to our weekly newsletter for exclusive and original coverage from ITV News. Direct to your inbox every Friday morning. The government has confirmed that the rate of income tax for billpayers will not change as a direct result of the reforms, with Burnham determined to stick to his predecessor's manifesto commitment of not raising taxes. The equalisation system will be retained, with areas where less tax is collected continuing to receive financial support. Fourteen areas in England have a regional mayor, including Greater Manchester, Liverpool City Region, Cambridgeshire and Peterborough, the North East and West of England, with this set to expand over the coming years to include areas like Hampshire and the Solent and Greater Essex. Mayors have powers over issues such as transport, skills and infrastructure planning. Burnham hosted several leaders across the different parties last Friday on his inaugural visit to No 10 North and said he was working to "make the UK one team". Burnham hosted regional leaders at No 10 North on Friday Credit: PA Chancellor John Healey said: “The people who best understand what skills employers want, what transport an area needs and where investment can make the biggest difference are those who live there. “For the first time we’re giving mayors a share of income tax so communities directly benefit when their economy grows – passing power out of Westminster and driving growth in every postcode. “This is the way we start to build new hope and advance the working people of this country.” Housing, Communities and Local Government Secretary Angela Rayner said the announcement would put “an end to the begging-bowl culture of the past”, instead giving locally elected leaders “the tools they need to drive the change that communities have been crying out for”. Rayner worked alongside Starmer at the start of his premiership to drive for more regional mayors and devolution and frequently shared the message that those "with skin in the game" are the best placed to deliver for their local area. Some mayors are thought to be considering using their powers to roll out tax reliefs, including Conservative Tees Valley mayor Lord Houchen of High Leven and Reform UK’s Greater Lincolnshire mayor Dame Andrea Jenkyns, according to reports in The Times newspaper. The Conservatives signalled they doubted the tax reforms would help regions across England to flourish. Sir James Cleverly said Burnham was right to focus on growth but warned his plans risked higher taxes and would not necessarily improve outcomes. The shadow local government secretary argued devolution should be developed with local communities rather than imposed from Westminster, adding that policies that work in Manchester may not suit areas such as Essex, Cornwall or Cumbria. The Lib Dems warned that devolving tax revenues to mayors would “leave behind large swathes of England” that did not have a mayoral authority. Reform UK home affairs spokesman Zia Yusuf said the prime minister should “fully devolve the power to stop the housing of illegal migrants in local communities by the Home Office”. He said: “Andy Burnham says he wants to devolve power and actually listen to local people. If he was listening, he would know that they do not want unvetted illegal migrants dumped in their areas.” Lib Dem local government spokeswoman Zoe Franklin said: “Councils across England serve millions of people who deserve the same powers and resources as any city region. “Devolution cannot become a two-tier system where you only get real powers, and access to extra income tax revenues, if you have a metro mayor. “We will analyse the detail carefully when it is published and continue to fight for every community across England to benefit from devolution.” From Westminster to Washington DC - our political experts are across all the latest key talking points. Listen to the latest episode below...