Rachel Reeves’ mansion tax could leave ‘50,000 struggling to pay bill’ | Politics | News
Rachel Reeves’ controversial mansion tax could leave up to 50,000 households struggling to pay their bills, predictions suggest. When you become chancellor tax This regulation, which will come into force in April 2028, is expected to apply to around 165,000 properties, with tens of thousands of property owners struggling to make payments out of their annual income, according to estimates from the Office for Budget Responsibility (OBR).
It is also estimated that thousands of owners could become stuck in the appeals system. OBR suggested 20% property Owners can appeal their valuations and 40% are successful.
The annual surcharge applies to residential properties in England worth more than £2 million in 2026. Valuations will be provided by the Government’s Valuation Office Agency.
The payments will be split into four groups and collected alongside Council Tax, but the money will go directly to the Treasury, not local authorities.
Properties valued between £2 million and £2.5 million will pay £2,500, while properties between £2.5 million and £3.5 million will pay £3,500.
Owners of properties worth between £3.5 million and £5 million will pay £5,000, while properties worth more than £5 million will pay £7,500.
The tax was announced as part of the Chancellor’s package of tax rises to meet self-imposed fiscal rules.
Ms Reeves told the House of Commons that the High Value Council Tax Surcharge would also address wealth inequality in Britain and would apply to 1% of properties.
Shadow Chancellor Sir Mel Stride said: Mail OBR analysis shows Labour’s new tax on homes will disrupt the housing market.
He said: “Fewer homes are being built, homes are being sold cheaper to avoid huge tax bills and more red tape and uncertainty for homeowners.”
Experts at the Institute for Fiscal Studies have previously said the “mansion tax” plan does not go far enough and called for a complete re-evaluation of council tax bands.
