UK PM announces tax share devolution for regional mayors

Prime Minister Andy Burnham announced a major new devolution policy on Friday, July 31, granting England's regional mayors a share of income tax and business rates collected in their areas to spend on local priorities. The move, described by the Prime Minister as the biggest shift of power from Westminster to the regions, aims to drive economic growth by empowering local leaders to invest in infrastructure, housing, and skills.

The plan allows mayors in areas such as Greater Manchester, the Liverpool City Region, Cambridgeshire and Peterborough, and South Yorkshire to retain a portion of tax revenues, which are currently funneled entirely to central government. Ministers have stated the rate of income tax billpayers face will not change, and a system will remain to ensure financially weaker areas continue to receive support. More specific details, including the proportion of taxes to be retained, are expected in a forthcoming white paper to accompany Chancellor John Healey's first budget this autumn.

However, the proposal has immediately sparked a political clash over how the new funding should be used. Several mayors, notably Conservative Tees Valley Mayor Lord Houchen, have...