Hello, Andy Burnham has been reported to be considering replacing council tax and stamp duty with a new tax based on property values.
Under the proposal, the tax would be paid by property owners rather than tenants. Owner-occupiers would reportedly pay 0.48% of the property’s value each year, while landlords, overseas owners and second-home owners could face a higher rate of 0.96%.
For a landlord with a property worth £250,000, that would mean an annual bill of £2,400. On a £500,000 property, the charge would rise to £4,800 a year.
Would landlords realistically be able to absorb another cost of this size?
Some may try to recover it through higher rents, but that may not be possible if mayors are also given powers to freeze or cap rents.
Even without rent controls, tenants may simply be unable to afford the increases needed to cover the tax.
I also wonder whether the higher rate would lead to an exodus of overseas landlords and second-home owners, while persuading more UK landlords that remaining in the private rented sector is no longer financially worthwhile.
Could this proposal reduce the number of homes available to rent and push rents even higher?
Would a property tax of this size be the final straw for you, or could it be a fairer replacement for council tax and stamp duty?
Thank you.
Altan
