Chancellor John Healey has ruled out cutting the threshold for the High Value Council Tax Surcharge, the so-called 'mansion tax', from £2m to £1.5m in the 28 October Budget, according to reports.
Property Week reports the decision, citing people familiar with the discussions who spoke to The Times and the Financial Times. The reason they give is that a lower threshold would undermine public support for the policy. The Treasury has not confirmed this.
Former chancellor Rachel Reeves introduced the surcharge in last year's November Budget. From April 2028, owners of properties in England worth more than £2m face a £2,500 annual charge, rising to £7,500 for properties worth more than £5m.
Reeves said the surcharge would be charged on less than the top 1% of properties and would raise around £400m by 2031. Those figures have not been independently checked.
Research by Yopa, cited by Property Week, says nearly one in 10 homes listed for sale in London would fall within scope at a £1.5m threshold. MPs had warned that a lower threshold would hurt London homeowners.