More than 21,000 homes in London could face annual property tax bills above £50,000 under a land value tax model linked to proposals supported by Andy Burnham, according to analysis by Tax Policy Associates.
How the Proposed Tax Would Work
The model applies an annual charge of 1.28% to the value of the land beneath each property. It would replace both council tax and residential stamp duty. Council tax is currently based on property valuations dating back to 1991, while stamp duty is paid when a home is purchased.
Supporters of reform argue that the present system is outdated and discourages people from moving. The figures are based on a modelling exercise and do not represent confirmed government policy.
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London Would Face the Highest Bills
The largest increases would be concentrated in areas with high land values. More than 15,000 homes in Kensington and Chelsea could face annual bills above £50,000. Properties in Camden, Hackney and Haringey would also be among those paying the highest amounts.
Across the UK, around 576,000 properties could face yearly charges above £10,000. London households would pay an estimated £19.6 billion a year, up from £11.1 billion under the current system. The capital would therefore contribute an extra £8.5 billion annually. The South East would pay around £938 million more.
Most Homes Would Pay Less
Tax Policy Associates estimates that 69% of homes would receive lower bills, while 31% would pay more. The levy could raise about £56.7 billion a year, replacing £45.2 billion from council tax and £11.5 billion from residential stamp duty.
The Treasury would collect roughly the same total amount, but the tax burden would shift towards areas where land is more expensive.
Bills Could Rise Outside London
Higher charges would not be limited to the capital. In Brighton and Hove, a Band D household currently paying £2,457 could face an estimated bill of £4,267.
In Bristol, the equivalent charge could rise from £2,584 to £4,791. Bills could also increase in Guildford and Waverley. The model assumes the tax would be introduced immediately, without a gradual rollout, caps, exemptions or arrangements to defer payment.
Homeowners and Renters Could Both Be Affected
Critics warn that older homeowners with valuable properties but limited incomes could struggle with much higher annual bills. Landlords may also try to pass the cost on to tenants through higher rents. Some could choose to sell, reducing the number of homes available in the private rental market.
Supporters argue that replacing stamp duty could lower the upfront cost of moving home and help first-time buyers. A nationwide land valuation system would still be required, creating a complex administrative task and likely disputes over how individual plots are assessed.
