Chancellor Rachel Reeves Plans New Property Tax Over £500K Amid £40-50bn Deficit

Rachel Reeves, the UK Chancellor, is reportedly considering significant changes to property taxation as part of efforts to address a £40-50 billion fiscal shortfall ahead of the autumn Budget. Proposals under discussion include replacing the current stamp duty with a new levy on properties valued above £500,000, which would be paid by sellers rather than buyers, and potentially introducing a recurring property tax to replace council tax, targeting high-value homes. Critics, including Conservative politicians and property experts, warn that these measures could disproportionately impact middle-class homeowners and ordinary Londoners, acting as a disincentive to sell and potentially distorting the housing market. The threshold for taxation and the rate remain subjects of debate within the Treasury, with concerns about creating market distortions around the proposed £500,000 or £1.5 million value points. Labour officials have not confirmed specific plans, and a Treasury source has reportedly denied that a new tax on sellers is imminent, though officials have been tasked with reviewing the complex property tax system. The changes seek to balance fairness and economic growth but face strong opposition amid fears of a 'wealth tax in all but name' and the impact on housing affordability and market activity.