Labour’ proposing a new property tax

[littlebilliie]

I’ve mulling over the “floated” new property tax, they plan to abolish stamp duty and tax on the sale in fact, adding capital gains to principal properties.

also to introduce an annual new tax on properties of £500k and above.

Labour is really going come unstuck as property as in the UK this is one of the cornerstones of financial stability. This could be a real Truss moment for Labour.

If there’s a sudden new tax on selling properties we may see the movements of property slowing down considerably.

Elderly homeowners could be discouraged from selling at this point as they may be moving through different properties as they downsize into sheltered accommodation and then into a care home this could completely slow the whole market down and an obstacle to sale.

Also if it’s perceived that property below £500k isn’t going to be taxed we could see an absolute rush to buy those properties which of course would increase demand and increase the value.

Any thoughts on this?

Not here there isn’t.

So the owners of this rather lovely 5 bed detached house in the outskirts of Liverpool won't have to pay mansion tax...

https://www.rightmove.co.uk/properties/166275947

Whereas the owners of this 3 bed terrace in Sutton will pay the mansion tax. It looks like a a very nice house, but not really a mansion (unlike the Liverpool one). For those who don't know the area, Sutton is a nice London suburb - but not posh. I'm pretty confident that the people living there are 'working people'.

www.rightmove.co.uk/properties/164339498

It's blatantly a tax on living in the SE, which is outrageous.

Will all housing need to be revalued. To determine the value of your home. Will the new value then increase the original council tax banding.

This also shows the blatant unfairness of council tax being based on house value.

Why on earth should the family living in the little Sutton terrace pay more council tax than the family living in the stunning Liverpool mansion?!? Per person council costs are lower in densely populated areas - like small terraced houses - since there's a smaller area to service.

But Rayner plans to 'redistribute' London council tax - from people already being rinsed for higher living costs and higher tax - and give it to people she deems more worthy. It's state-sanctioned theft, plain and simple.

I mean, don't get me wrong - the Sutton house is really nice. At that level of mortgage, I'd expect it's owned by a dual professional income couple - eg a solicitor and teacher. Who will have to go back to work straight after maternity leave to keep the mortgage payments up.

But it's nothing like the Liverpool house - with 5 bedrooms and 2 huge living rooms, detached in landscaped gardens, huge new kitchen and a fucking pony cycle in the living room.

In what world should they be subsidised by the Sutton family in their 3 bed terrace?

The Sutton buyers will already pay £10k more stamp duty than the Liverpool buyers: £17k stamp duty for the 3 bed terrace versus £7k stamp duty for the 5 bed detached house in landscaped grounds. No stamp duty on the ponycycle.

I live in leafy Surrey. There are lots of flats, terraces and some 3 bed semi detached currently under £500k.

However I assume like many taxes, the threshold won't increase and within 10 or 20 years, even fewer properties will be under 500k.

Hopefully.

They'll probably add some other extra tax, just for landlords. The cost of which landlords will obviously pass on to tenants. That's what businesses always do in order to keep the profit margins they need to make being in business worthwhile, (rather than investing elsewhere).

Some landlords will decide it isn't worthwhile and sell. That will make the housing shortage for tenants even worse - which will increase rental prices further

And it won't even increase the supply of houses to buy by an equivalent amount. REnted homes are generally less under-occupied than owned houses, since the cost of moving to better suit changing needs is lower..

Why are you hoping to make things worse for renters?

We tax things like smoking because we know taxing something discourages that activity. Labour have taxed jobs and the inevitable has happened, they will end up driving up the prices of cheaper properties and just add another shit ton of tax on normal family homes on much of the south. People are just going to start giving up.

Think theres talk of adding NI to tax paid by landlords, either the cost will be passed onto the tenants and/or reduce supply of rental homes, which will of course lead to an increase in rents.

No-one can be this stupid, it has to be ideological.

Yes, it's called Fabianism.

You re acting as if Labour have actually gone and done all of these things... did you sell your ISA's too, based on rumour?

Have you seen the budget plans? no you have not

These "Stories" are just right wing media scaring people, kept alive by people like you & a few others, who keep spreading them, without a shred of evidence.

There were threads all over MN, pre election and October budget on the removing of the single persons discount for Council Tax... guess what, never happened.

CT reform would take years, millions of properties to re value, appeals etc etc.... and electorally, suicidal.

Same with extra taxes on BTL, all would be passed onto tenants, often the most least well off.... wont ever happen.... see above.

But i suspect you'll just carry on spouting falsehoods.

Council rax does need sorting out - it has not been changed in 30 years. However, wacking another bill on top of CT monthly taxes is not the way to do it.

If Reeves abolished both Stamp duty and council tax and went for a % property tax instead, I would be interested. It works well in other countries.

By the time she did this or any other significant reform, we'd be into an election year, the new Govt then getting the credit for it.... Reeves would just get the pain, as this thread proves.

We are 3 years away from the start of GE campaigning......

Major reform of anything in this country takes years, hence it rarely happens, esp by a Govt languishing in the polls.

I predict a very boring budget, with more Austerity, a few tax changes and allowances, she wont even extend the income tax th freeze, that will only benefit the next Govt.... which might not be Lab!

These possible new taxes have been deliberately leaked by the government - not the right wing media - in order to assess people's reactions. And because they can't be bothered thinking it through for themselves.

Wouldn't be much good of no one told them the obvious.

Why would I have sold ISAs? What stupid Labour suggestion have I missed now?

A link to the leak by the govt please?

Have you not heard of focus groups?

The originally story came from a rightwng thinktank called Onward, treasury officials were alleged to have looked at it, out of this, we now have "Reeves plans to tax your house and to put NI on rental profit...."

Cash ISAs were supposed to be losing their tax free status... another story found to be BS.

Council tax should be based on the cost of providing the services - and should go to the council of the people paying it. With our hugely skewed housing market, basing it on house price and redistributing it across the country is completely wrong and unjustifiable.

As for CGT on residential property, I'm OK with it so long as it replaces stamp duty, it genuinely takes inflation into account (so either an inflation-based calculation or taper relief for long-held property, as they have in other countries), it accounts for capital investment in the property, and it applies equally to all properties - no lower limit and no bands based on value.

I'm thoroughly fed up of being robbed again and again. Everyone needs to pay their fair share.

CT is often higher in poorer lower value areas, simply because the council has to fund more adult and child services, esp long term care of the elderly.... so how does that work for your "everyone pays for the services they get..."

Hence Westminster council has very low CT, far lower than mine in Cornwall.

CT is unsustainable, it cannot keep going up by 5% each year - Austerity meant central Govt cut funding, our CT keeps going up, services get worse.

She was going to reduce how much you could put into Cash ISAs each year. Taking existing savings and investments out of the ISA wrapper would be an odd reaction to that . She decided not to because the financial industry told her it would be unfair to less financially knowledgeable savers, who shouldn't be pressured to invest in S&S.

I'm keeping an eye on what's being leaked about controlling investments though. There's a suggestion that they'll force pension companies to invest in UK infrastructure - which I'm not sure any amount of tax incentive justifies.

No actual evidence she was going to do this at all.... all rumours.

But tbf to you, why shd the tax payer fund a tax wrapper than invests in other countries economies??
However, i ve seen that in my investments, more has moved away from US funds to European ones, not much but Trump is volatile, not least driving India and China closer together, not long ago, bitter enemies.

Evidence

https://www.google.com/amp/s/www.bbc.com/news/articles/cqjq9yxkkrvo.amp

Labour are purposely leaking potential policies to see how they will go down with markets/public etc:

https://www.ft.com/content/660acd4d-d768-4bb0-8ffd-711e47127002

More evidence

https://www.theguardian.com/money/2025/jul/11/cash-isas-rachel-reeves-pauses-plans-to-reduce-amount-savers-can-put-in

Always heartening to see that the Government has a plan and the strength of its convictions when planning it's tax policies. Rather than needing to run it past the voters first...😆

Oh so now "Hearsay" is evidence? might help to read your own link first?

But Rachel Reeves was thought to be considering reducing the allowance for tax-free cash savings, in a bid to encourage people to put money into stocks and shares instead and boost the economy

Thought? by whom??? no article names a single person, its ALL rumour and whispers.

There is so much speculation by the media, desperate to find a story... fishing trips.

why shd the tax payer fund a tax wrapper than invests in other countries economies

To encourage saving, in order to reduce the future burden on the state: tax is often used to encourage specific behaviour. Seems sensible to me.