THE EUROPEAN COMMISSION has urged the UK to raise taxes on higher-value properties, build more houses and make changes to the Help to Buy Scheme.
The commission recommended council tax bands should also be revalued, likely to see bills rising.
It forms part of annual advice given to EU member states designed to aid their economic growth. In comprehensive recommendations, the commission said the UK should prioritise capital spending, affordable childcare, bank lending to small firms and making the planning system more predictable.
But it said tax reforms were necessary to "alleviate distortions in the housing market".
Increasing property values are not translated into higher property taxes as the property value roll has not been updated since 1991, it noted.
"Taxes on higher value property are lower than on lower value property in relative terms due to the regressivity of the current rates and bands within the council tax system," the report said.
Local government minister Brandon Lewis said: "A council tax revaluation is unnecessary, expensive, and would push up taxes on people's homes. This Government is funding a five-year council tax freeze that has already delivered a 11% real-terms reduction in bills for hard-working families. This is in stark contrast to the last administration, when council tax bills doubled."
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