Overview

• Treasury officials are modelling a centrally set 'proportional' levy on owner‑occupied sales above about £500,000, collected by HMRC and drawing on an Onward blueprint, according to multiple reports.
• The levy would replace stamp duty on primary residences while retaining the 5% surcharge on second homes, with phasing options under review and no decisions yet made.
• A separate local property tax to replace council tax is being examined as a medium‑ to long‑term reform likely requiring more time and potentially a second term.
• Officials argue the approach could stabilise revenues versus stamp duty, which raised £11.6bn last year and currently applies to around 60% of sales, whereas the model would affect roughly 20%.
• Political and market reaction centers on regional impacts—Hamptons data show half of £500,000‑plus sales are in London and a further 26% in the South East—and conveyancers warn speculation could disrupt chains ahead of the Budget.