19 Aug 2025
Stamp duty could be scrapped and replaced with property tax
According to a report in the Guardian, senior ministers have asked Treasury officials to look into a “proportional” property tax to see how it would work as an alternative to the existing stamp duty land tax on owner-occupied homes.
There has also been talk about introducing a local property tax to replace council tax. However, this isn’t something that would be implemented for a while, and may happen if Labour wins the next election.
The stamp duty rules changing in April 2025 gained criticism for lowering the thresholds meaning some buyers, especially first time buyers, would have costs that they wouldn’t have incurred previously.
“Property tax would be paid by owner-occupiers on houses worth over £500,000 when selling up.”
The new proposed tax would be charged when those who own and live in their home (owner-occupied homes) sell their property worth more than £500,000. The amount charged will be calculated by the value of the property, with the rate being determined by the central government which would be collected via HM Revenue and Customs.
Stamp duty on second homes would remain the same. The property tax would only be applicable on owner-occupied homes.
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