Reeves considers property tax to replace stamp duty

The Treasury is examining plans for a new tax on the sale of homes worth more than £500,000 as part of a shake-up of stamp duty and council tax.

- TOM WATLING

Chancellor Rachel Reeves has asked officials to study how a new “proportional” property tax could be introduced and to model its impact ahead of this autumn’s Budget. Ministers have already been briefed on the proposals, which could be rolled out during this parliament, TheGuardian reports.

Under one option, a national property levy would replace stamp duty on owner-occupied homes. In the medium term, a second stage could see a local property tax replace council tax, a move designed to repair the finances of struggling local authorities.

No final decisions have been made. Treasury sources stressed that while a national levy could be implemented in the coming years, reform of council tax would take longer and would probably depend on Labour winning a second term.