Reeves' plan to tax houses over 500k

[FridayFeelingmidweek]

Just been reading news about Reeves's plan to tax https://www.theguardian.com/money/2025/aug/18/rachel-reeves-stamp-duty-property-tax-council-tax

AIBU to already be worrying about living in the south east? Surely this will force people either to never move, or move away from SE/London.

I'm glad that there is finally something that isn't negatively affecting areas outside the SE but does she actually understand that 500k isn't much down here - 3 bed terrace at best.

The cost of extending would be offset. As I said it’s a cgtax calculation

Ten years ago maybe, but we will have to see how this plays out. If you can live in secure council tenancy rents paid, universal credit etc, pensions credit, care paid, etc.
Edit - exempt from various taxes (these being discussed), talk of prioritise for school places, prioritised for nhs

In a world of AI and high unemployment it might be better to tell the kids to take the safe route. They aren’t going to be much better risking everything and potentially would be worse off.

We will have to see how it goes.

Apart from VAT on school fees, what extra tax have you been clobbered with in the last year?

Everyone. Compared to the Scandi countries left wingers are so fond of quoting, low earners pay very little tax.
However 3 things need to happen:

• cut spending
• stop spaffing money away
• raise income tax across the board

Just targeting individuals creates divides and class warfare and pits citizen against citizen with no material benefit to the Treasury.

NHS is unsustainable now, we need a grown up conversation about how to fund healthcare long term. Education is unsustainable especially SEND so again we need grown up conversations across all parties. Welfare Bill is unsustainable.....you get my drift.

The NHS has been starved of money for years, so I doubt there is any slack there. Shall we cut defence, in an increasingly dangerous world? Or maybe stop paying state pensions, after all everyone should have funded their own?
I do not like straight property taxes, personally, but if you want the infrastructure of a modern society then taxes must be paid.
Oh, I thought of a couple - stop subsidising share holders of railway lines and stop water companies paying dividends instead of fixing leaks - the taxpayer picks up the costs of leaks and floods, so we should save something there.

@Bambamhoohoo

They will always be better off earning more

That's not the case though. There are plenty of points on the income scale where loss of benefits along with taxes on extra income can make you worse off.

And even more instances where, yes, you'll be better off in purely tax/benefits terms, but when you factor in child care costs, commuting costs, etc., you do end up worse off.

I'm a long advocate for a "maximum" marginal rate (tax and loss of benefits) of 50%, so that whatever income level you're sat at, working an extra hour, shift, day, etc will guarantee you can keep at least 50% of it, having taken account of loss of benefits, taxes, etc. If you know you're going to lose over half of your "extra" wage, it's a massive disincentive to actually bother doing it, bearing in mind child care, commuting, AND loss of your personal enjoyment time.

No one should be taxed anything more than we are.

Instead cut the systems and benefits that stifle aspiration. Or cut services and make people pay for them or get insurance.

Reward those working by allowing them to keep more of their hard earned money.

Force people who choose not to work, back into work, by not giving them an alternative. (With the exception of people with severe disabilities). If people HAD to work to pay for food, health etc, then they would.

Otherwise things are going to go downhill pretty quickly.

Jeremy Hunt (longest serving health secretary in living memory) says changing the NHS funding model would catastrophic and is unnecessary.

Since when have you agreed with Hunt?
I was asked for my opinion, I gave my opinion.

I'll tell you what you don't do: raise NI and tell the public it won't impact "working people" then act "surprised" when businesses close and unemployment figures rise!

No it's not, it's all about limits - there is a point when even the most driven person will ask themselves how many pennies out of pound they can keep if they work more/progress more/expand their business more etc, and there is a point at which it doesn't make sense anymore.

You progressed to 100k - there is a 62% tax for you and no childcare

You earned well and want to give up on state service and send kids to PS - there is a tax for you

You earned and saved to pass on to your kids - there is a tax for you

You can't be bothered / have anxiety / stress/ won't work - there is no tax for you and here are your benefits paid.

Read the thread and you will see what it was in response to

They’ll probably spend lots of time and money discussing then implementing it. Then they’ll u turn and retract it. That seems to be their MO.

What was she supposed to do? Her issue was she made a totally unaffordable promise not to raise working NIC, income tax or VAT, taking off the table all 3 of our biggest tax raisers.

Yes fiscal incompetency is her issue.

Time for them to raise income tax, it’s fair, easy to implement and raises a huge amount of money to pay for their exuberance.

On top of which it is take take take take from higher earners / financially more successful people. Eventually when so much is taken and nothing is given back, and we can see others contributing fck all, and being given everything, we stay stop. And make different plans, where it’s not going to be feasible for Labour to take any more.. Whatever that may mean for individuals.

YES

The taxes of millenials have paid for years of state pension and nhs healthcare when our generation is likely to receive neither in our later years. A few years of property tax before she passes on after a long and happy life in that property or spending the equity on cruises isn't the worst thing in the world.

It’s the attitude to. The way posters here absolutely slaughter those on £100k who baulk at paying full whack in nursery fees. So much greed and envy.

But this is so basic! What about all the advantages?!?
-Giving your children a beautiful house and garden vs housing waiting list.
-Having your children experience a wonderful school after than the local sink school.
-Your children having a house deposit through inheritance rather than the generational joining of the social housing register on their 18th birthday?!

i think im too working class for this discussion.

i also think the childcare cliff is a perfect example of the short term bitter thinking.

fwiw i am an additional rate tax payer who had one child go through the pre school years with no funding. the idea that i would dial back my job to save approx £3k a year for 2.5 years is BOGGLING to me.

since that time i earn £30k a year more and my children don’t have any childcare costs. Im kind of glad there are lazy people around who would’ve gone part time in response to being forced to pay £3k that other people get for free, because at least there is less competition eh?

but I have never met any £120k worker who dials back to avoid tax (I have a few who work for me) most don’t like it, but grit their teeth and think about when they’re on£150k and it’s less of an impact.

I mean we could have saved £35 billion by not handing it over to Mauritius:

https://www.telegraph.co.uk/politics/2025/08/10/revealed-chagos-deal-to-cost-10-times-what-starmer-claimed/

You need less people taking out.
But that's unthinkable.

You can not keep squeezing more tax out of people.

You need to encourage business to flourish and employ lots of people on good money.
You do that with a good tax regime.

We have a worse tax regime than we did before they got to power.

They need to spend less.

They have already run out of our money and are keeping on spending.

This tax has just been explained really well on R2 Jeremy Vine show. When you buy a house for over 500k instead of paying a one off SDTL amount you pay an annual amount every year for the rest of the time you live in that house. Eg

If you buy a house for 600k you avoid SDLT of 20k.
Instead you pay an annual charge of say around £650 (a certain percentage of the house value).
If you move house again no SDLT but the annual charge changes up/down.
Anyone who has already paid SDLT on their house is exempt.
Anyone who buys a house under £500k is exempt.

Sounds great to me. Stamp duty which is a massive barrier to moving house. This is a real incentive to downsize after the kids leave home - no SDLT and a lower annual charge. If you stay in your house 30+ years you may pay more but lots of people will pay less, or nothing.

This has nothing to do with the proposed council tax changes. That’s a different scheme. This is just a replacement for stamp duty.

I am so annoyed as I plan to move to a low tax jurisdiction in 5-6 years I just need to survive this shit show and then it’s goodbye