Overview

• Under the option being modelled, owner‑occupiers would pay a proportional levy when selling homes valued above about £500,000, with rates set nationally and collected by HMRC, and stamp duty would continue to apply to second homes.
• The Treasury says choices will be made at the autumn Budget and emphasises a focus on growth and protecting core tax rates for working people, while signalling that any national levy could arrive this Parliament.
• Unlike stamp duty paid by buyers on roughly 60% of transactions, the proposed charge would apply to about 20% of sales; stamp duty raised £11.6bn last year and officials view a proportional levy as a steadier source of revenue.
• Analysts warn the burden would fall heavily on London and the South East—about half of £500,000‑plus sales are in London—with critics branding the idea a tax on ordinary Londoners and cautioning about market distortions around the threshold.
• Parallel work includes a medium‑term local property tax to replace council tax and exploration of ending capital gains relief on very high‑value main homes, with experts flagging downsizing disincentives and complex interactions with other taxes.