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Rachel Reeves eyes up property tax raid on the wealthy

Journalist: Katie Elliott, Daily Express

ended 20. August 2025

Rachel Reeves is reportedly eyeing up a property tax raid on the wealthy to help balance the books . It's rumoured that she may be looking to replace stamp duty with either:

  • New council tax bands on the highest value properties in England, 
  • A recurring property tax on homes valued above a certain amount that could replace stamp and council tax
  • A property tax levied on the sale of homes valued over £500,000

 One commentator described this as “a diluted form of capital gains tax, by the back door”. 

What are your thoughts? Is this a good idea?

9 responses from the Newspage community

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Editor
Stephen Perkins
Managing Director at Yellow Brick Mortgages
The proposal of new property tax, is another that will hit working people. Whilst both stamp duty and council tax are long overdue for reform, this isn’t the solution. The property market thrives on stability and buyer confidence and these proposals take a sledge hammer to these foundation stones.
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Samuel Mather-Holgate
Managing Director & IFA at Mather and Murray Financial
Reeves needs cash, and both the council tax system and stamp duty need reform. However, Reeves might not be the most trustworthy to implement a suitable solution. Her early track record isn’t good. Reducing payments for cheaper houses would be welcomed by most of the electorate, and should be a vote winner l, but getting that balance right of where payments increase is tricky. It’s rumoured that stamp duty could change to when selling rather than buying a property. There would be an initial transition period and this could help buyers get on the market but this isn’t going to raise the sort of money needed at number 11.
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Scott Gallacher
Director at Rowley Turton
Rachel Reeves has two big challenges - balancing the books and growth to help balance those books. The question here is whether she is looking to reform property taxes to get the property market moving and hopefully bolster the economy. Or is she using this as a tax-raising measure? If it turns out to be the former, then this is to be applauded. However, if it's the latter, then it may turn out to be a spectacular own goal, slowing down the property market, and also the economy, as people sit tight rather than move and incur large tax bills.
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Tony Redondo
Founder at Cosmos Currency Exchange
As always, the devil will be in the details. A well-designed system could work economically, but execution risks are substantial, and chances are, this will end up as another ‘dog’s dinner’. Benefits include stable revenue generation, greater progressivity since property wealth correlates with overall wealth, and improved economic efficiency versus stamp duty, which distorts housing markets. The many challenges include the "asset-rich, cash poor" homeowners, especially retirees who may struggle with annual payments, regional disparities as £500k affects London differently than northern England, and the administrative complexity of new valuation systems. The "capital gains by the back door" comparison has merit - it would capture untaxed property appreciation. Success depends entirely on implementation details, exemptions, and hardship protections.
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Aaron Strutt
Product and Communications Director at Trinity Financial
Stamp duty clearly needs to be changed but we need a sensible policy that doesn't prompt wealthier individuals to give up and leave the UK or downsize to avoid the costs. There has to be a fair system where people pay tax but also move home, if borrowers are put off buying, the trickle down effect hits the economy. Builders are quieter, removal men are not as busy, interior designers are quieter as well as decorators. Taxing everyone stifles the economy.
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Editor
David Stirling
Independent Financial Adviser at Mint Wealth
Replacing stamp duty with a recurring property tax risks swapping a bad tax for an unpopular one. A recurring property tax sounds simple, until you meet the widow in a £700,000 house who can’t afford her heating bill. Calling Rachel Reeve's policy a levy on the rich won’t comfort the ordinary families in London, already caught up in a cycle of super high property prices and now these potential new bills.
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Kundan Bhaduri
Entrepreneur, Investor and Landlord at The Kushman Group
A recurring property tax is simply going to be stamp duty in monthly instalments, except without the choice. It penalises people not for earning more, but simply for owning something that has risen in value over time. People who worked hard, paid in full, and stayed put now face a lifetime bill just for living in their own home. Meanwhile, the truly wealthy will restructure their assets and sail straight past it, leaving middle Britain to pick up the tab.

Rachel Reeves thinks she is targeting the wealthy, but she is actually mugging middle England in broad daylight. A £500,000 property threshold sounds like a Downton Abbey mansion until you realise it covers most three-bedroom family homes from Guildford to Canterbury.

This is economic cruelty disguised as progressive policy. Pensioners on fixed incomes will discover that their biggest asset has become their biggest liability, generating bills they cannot afford from wealth they cannot access.
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Premium
David Belle
Founder and Trader at Fink Money
Unimproved land value tax is the answer here, not a property tax.

If you tax property, it removes the incentive to improve the property (land).

What we need to do is tax the thing that can't be picked up and moved, not the productive capacity of the economy in wages and capital.

The government will never understand this concept, since they do not have the required talent to think deeply about incentives rather than how much money their silly models can raise.

If we take land, everyone needs it to live, work etc. Taxing the UNIMPROVED value of it would widen the tax base, while delevying taxes on capital and income would encourage work and investment, leading to more landowners and a more equal tax base, smoothing out boom and bust.

It would encourage building since the only way to make a profit above the tax is if you don't sit on the land, and slum landlords would be totally taken out of the equation.
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Scott Taylor-Barr
Principal Adviser at Barnsdale Financial Management
Sadly, this is tinkering around the edge of the UK's messy and confusing property tax landscape. What the Chancellor would be better off doing is looking at both Stamp Duty and Council Tax and replacing both with a new set of taxes based on property value and paid by the existing owner, one at point of sale similar to Capital Gains Tax and one annually for on-going services. The current system sees Stamp Duty paid for by the buyer, which stifles people's ability to move by adding cost to an already very expensive process for them, and Council Tax is based on property values from decades ago; which sees property in London being charged the same level of Council Tax, or sometimes less, than a property in Hull now worth a fraction of the cost. With modern electronic valuation models and house price records, it should be far simpler to set a Council Tax replacement based on an up-to-date property price and update these every few years, rather than use figures from a few decades ago.