Exclusive PrimeResi survey finds most respondents favour shifting the tax burden away from transactions and towards property ownership – but opinion is split over abolishing SDLT altogether.
England’s property tax system needs a do-over, with much less tax levied on people when they move home, according to a survey of senior figures across the prime residential industry.
As pre-Budget chatter escalates and the new “Mansion Tax” looms, PrimeResi quizzed a panel of 15 business leaders and experts – including estate agency bosses, buying agents, mortgage brokers, lawyers and more – to find real-world views on what’s wrong (and right) with the current property regime, and what could be done to improve it.
Almost two-thirds (64%) of respondents back a system combining lower transaction taxes with higher annual property taxes. Another 18% favour going further and replacing both Council Tax and Stamp Duty Land Tax (SDLT) with an annual tax proportionate to current property values.
That means 82% of the 11 who selected from our list of seven proposed models favour a substantial shift in the tax burden away from transactions and towards recurrent taxation.
Perhaps surprisingly, however, there is little consensus on abolishing SDLT altogether: Asked separately whether residential SDLT should be scrapped and the revenue raised elsewhere, 45% of panel said yes, and 55% said no.
Most favour retaining some tax on transactions, but scaling it back and rebalancing the system towards annual property levies.
PrimeResi Property Tax Survey 2026: Preferred system
| System | Responses | Share |
| Lower transaction taxes, higher annual property taxes | 7 | 64% |
| Annual proportional property tax replacing Council Tax and SDLT | 2 | 18% |
| Transaction-led system, with reformed SDLT rates and thresholds | 1 | 9% |
| Capital gains-based system | 1 | 9% |
| Reformed Council Tax | 0 | 0% |
| Land value tax | 0 | 0% |
| Current system plus high-value surcharges | 0 | 0% |
| Broader wealth tax | 0 | 0% |
Property taxation is high and rising on the political agenda. The new High Value Council Tax Surcharge is due to come into play in 2028 (prompting much consternation how imminent valuations will work in practice, and whether the £2mn threshold will be lowered before it even starts), and there’s traditional rampant speculation about what may feature in November’s Budget – particularly since new Prime Minister Andy Burnham has previously voiced support for major property tax reforms.
So PrimeResi asked senior industry figures how they would redesign England’s residential property tax system from scratch, on the assumption that any replacement must raise at least as much revenue as the existing regime while supporting a healthy, active housing market.
The overwhelming complaint was not that property is taxed per se, but that too much of the burden falls on the act of moving.
‘We should be encouraging people to move, not taxing them for moving’
– Daniel Daggers, DDRE Global
Daniel Daggers, founder of super-prime brokerage DDRE Global, backs lower transaction taxes and higher annual property taxes. “The principle is simple: we should be encouraging people to move, not taxing them for moving,” he said. “At all levels but especially the upper end of the market, the cost of moving has become so significant that people simply stay put. They do not upsize, downsize or move when their circumstances change. That locks up availability, reduces choice and takes momentum out of the entire market.”
Camilla Dell, boss of buying agency Black Brick, reached the same conclusion, describing SDLT as “a tax on mobility”.
“The fundamental problem with the current system is that Stamp Duty actively discourages people from moving,” she said. “At the upper end of the London market, the sums involved can be enormous and increasingly influence buyers’ decisions about whether to transact at all.”
Most of our pundits agree: High upfront taxation discourages first-time buyers, prevents growing households from trading up, and makes downsizing less attractive to older homeowners.
Dominic Agace, chief executive of Winkworth, pointed out that first-time buyers could end up delaying their first purchase until they could afford a larger property, while older homeowners may conclude that the cost of downsizing outweighs the benefits.
“The result is reduced housing supply, limiting mobility and ultimately constraining new housing delivery,” he said.
Maxine Reynolds, head of residential sales in Oxford at Bidwells, flags the same issue outside the capital. “From what we see in Oxford and Cambridge, the housing market is increasingly stuck at both ends,” she said. “First-time buyers face significant affordability challenges, while at the top of the market there are many people living in larger homes who might otherwise consider downsizing, but the cost of moving can be a significant deterrent.”
Alex Greaves, MD at Ridgestone Property, put it pithily: “Stamp Duty is a tax on moving, and moving is precisely what a healthy housing market needs people to be able to do.”
Stamp Duty: abolish or reform?
There’s broad agreement on the problem, but divided opinions on how far reform should go.
Should residential SDLT be abolished?
| Answer | Responses | Share |
| No | 6 | 55% |
| Yes | 5 | 45% |
| Unsure | 0 | 0% |
Dell, Agace, Greaves, James Greenwood of Stacks Property Search and Islay Robinson of Enness Global all favour outright abolition of Stamp Duty, provided the lost revenue was raised elsewhere.
“Stamp Duty is a tax on moving, and at the top of the market it has become a tax on the market functioning at all,” declared Robinson. He favours replacing both Council Tax and SDLT with an annual levy.
“An annual proportional charge on current values fixes the incentive at both ends,” he explained. “It taxes ownership rather than movement, so downsizers, upsizers, relocators and international buyers can transact freely, transaction volumes recover, and the Treasury swaps a lumpy, cyclical revenue line for a predictable one.”
Others don’t want a full-fat abolition of SDLT.
Daggers thinks a “modest transaction tax is reasonable”, but says current rates are too high, and are altering market behaviour.
Martin Bikhit, founder and CEO of UK Forbes Global Properties, also favours retaining a much lower transaction tax, while shifting more of the burden towards annual taxation.
Mark Harris, Chief Exec of high-value mortgage broker SPF Private Clients, prefers retaining a transaction-led regime (albeit reformed), rather than leaning into annual charges. He argues that scrapping SDLT altogether “would just be robbing Peter to pay Paul as any Treasury black hole would have to be covered with tax hikes elsewhere.”
Notwithstanding political ire, the sums involved explain the Treasury’s difficulty. Residential SDLT generated £10.38bn in 2024/25, according to HMRC, with homes above £1mn accounting for just 3% of residential transactions but 41% of residential SDLT receipts.
Property tax as economic multiplier
Respondents repeatedly argued that high transaction taxes take a toll on a big chunk of the economy.
“A house move doesn’t just generate Stamp Duty; it supports estate agents, lawyers, surveyors, mortgage providers, removals firms, builders, decorators and retailers,” said Dell. “Taxing the transaction too heavily risks suppressing all of that associated economic activity in pursuit of the tax receipt itself.”
Jamie Freeman, director at buying agency Haringtons UK, argued that every move creates work across construction and professional services as well as generating VAT. “Lower transaction taxes could actually get far more money moving through the economy,” he said.
And there’s also the question of London’s international competitiveness. “The top end of the property market is incredibly mobile and internationally competitive,” explained Daggers. “Buyers can choose London, Dubai, Monaco, Miami, Milan or anywhere else in the world.”
Robinson said Enness was increasingly encountering the same calculation among internationally mobile borrowers. “London does not have a demand problem,” he said. “It has an entry-price problem that the Treasury itself created.”
London does not have a demand problem. It has an entry-price problem that the Treasury itself created.
– Islay Robinson, Enness Global
The annual-tax problem: Asset Vs income
Most in the industry seem to agree that Stamp Duty is clearly the baddie. But there are also big problems with the favoured alternative.
An annual tax based on current property values creates potentially significant liabilities for homeowners whose property wealth bears little relationship to their disposable income.
“The important word is fair,” said Daggers. “Any annual system would need to be proportionate and protect people who may own a valuable home but do not have the income or liquidity to absorb a significant annual charge.”
Bikhit said deferral arrangements would be required for “asset-rich but income-poor homeowners”, while Reynolds called for “protections, deferrals or carefully designed exemptions”.
Agace warned that replacing SDLT overnight with a high recurring tax could, in extreme cases, force people from their homes.
Greaves agrees: “Owning a valuable home does not necessarily mean having a high income.”
The issue is already being addressed in the design of the new HVCTS. The Government’s consultation includes proposals for a deferral mechanism for owners unable to pay the surcharge, alongside reliefs, exemptions and an appeals system.
The answer is not to replace one flawed system with another, but to rebalance taxation over time
– Dominic Agace, Winkworth
Another issue is how to move from one regime to another without penalising buyers who have recently handed substantial sums to the Treasury.
Several survey respondents proposed some form of SDLT credit. Bikhit suggested purchasers who had already paid substantial Stamp Duty should receive a time-limited credit against a new annual tax, with any unused balance remaining portable if they move. “This would avoid double taxation without trapping properties within the old system,” he said.
Greaves also pitched a time-limited credit or phased introduction.
Robinson would go further, crediting SDLT paid on residential purchases from 2023 onwards against future annual property charges. “Anyone who bought in the last two or three years has already paid a six-figure entry tax and cannot reasonably be asked to pay twice,” he said.
Agace also warned that simply abolishing SDLT and imposing a replacement recurrent tax would be “deeply unfair” to recent purchasers, insisting that “the answer is not to replace one flawed system with another, but to rebalance taxation over time.”
Council Tax reform
Unsurprisingly, our panel expressed no support for simply retaining the existing system and bolting on further taxes to expensive homes.
From our multiple choice selection, no-one picked the “current system plus high-value surcharges” option. Nor did anyone favour retaining Council Tax as the principal property tax and merely updating its valuations and bands.
Council Tax in England is still rooted in 1991 property values. It raised £40.3bn in 2024/25, making wholesale replacement a considerably bigger fiscal undertaking than reforming SDLT alone.
Dell says her clients generally accept that Council Tax is too low and would be prepared to pay more, but warned against simply adding new charges to the existing regime: “What we should avoid is simply layering another annual charge on high-value properties while leaving punitive transaction taxes untouched. That risks increasing the overall tax burden without addressing the fundamental problem.”
Freeman also backs tweaking what’s there rather than create another tax. “We don’t need a mansion tax, a land tax or another layer of complexity,” he said. “Reform what we already have: make Council Tax more proportionate, make Stamp Duty simpler and cheaper, and get people moving again.”
Guy Meacock, head of the London office and director of Savills-owned buying agency Prime Purchase, highlighted the practical difficulty of rebuilding Council Tax. “Councils are in dire straits and Council Tax hasn’t been revalued in years, while adding new bandings doesn’t help,” he said. “But reforming Council Tax is a massive piece of work, heavily labour intensive and costly to do.”
We don’t need a mansion tax, a land tax or another layer of complexity. Reform what we already have
– Jamie Freeman, Haringtons UK
Regional matters
Becky Fatemi, Executive Partner at UK Sotheby’s International Realty, flagged another issues with value-based annual taxation: a national property threshold does not necessarily represent the same degree of household wealth across England.
“We have to stop pretending the same property value means the same thing everywhere,” she said. “A £500,000 house in Leeds could be home to a family of four with two established careers and considerably more financial means. In London, £500,000 might buy a one-bedroom flat for a first-time buyer stretching every penny to get onto the ladder.”
The same issue would apply to additional Council Tax bands or other annual charges based on nationally fixed values, she argued. “London and the South East will inevitably pick up a disproportionate amount of the bill simply because property values are higher.
“I would look seriously at geographical weighting. Decide what constitutes a genuinely high-value home within each market and tax accordingly. Otherwise, we aren’t necessarily taxing wealth, we’re taxing geography.”
Fatemi also suggests the Treasury should look harder at ultra-prime homes held through corporate structures before raising taxes on conventional homeowners. “If the Government wants to raise more money from high-value property, start at the very top,” she said, arguing that the existing Annual Tax on Enveloped Dwellings could be increased substantially for very expensive homes held within companies.
We aren’t necessarily taxing wealth, we’re taxing geography
– Becky Fatemi, UK Sotheby’s International Realty
Tax the gain instead?
There’s limited support for a more radical alternative: replacing much of the tax on purchasing with tax on the gain made when a home is eventually sold.
Buying agent James Greenwood was the sole respondent to select a capital gains-based regime as his first choice, including taxation of gains on principal residences.
“The baby boomers have benefited hugely from rising property values over their lifetime, so it’s reasonable that they should make the lions’ share of the contribution to a property tax system,” he argued. “Young buyers are dealing with a cost of living crisis, mortgage rates that show no sign of going down, and high property prices. It seems wrong that they are the ones who should be bearing the brunt of property taxes.”
Fellow buying agent Guy Meacock also sees merit in moving the burden from entry to exit. “Capital gains on exit is an alternative, as if you are going to tax the transaction, it is better to do so on exit rather than entry,” he said.
The baby boomers have benefited hugely from rising property values over their lifetime, so it’s reasonable that they should make the lions’ share of the contribution to a property tax system
– James Greenwood, Stacks Property Search
Other ideas: instalments, regional thresholds & taxing land banks
Commentary around our survey threw up several alternative proposals.
Jason Tebb, president of property portal OnTheMarket, would retain SDLT but reduce it substantially and allow buyers to spread the bill over time, potentially through payroll or a government-backed scheme. “This would have the widest market benefit – reducing upfront barriers to homeownership and helping rebalance the tax burden over time,” he said.
Elizabeth Small, head of corporate tax and partner at law firm Forsters, pointed to New South Wales as an alternative model under which some buyers have been offered a choice between an upfront transfer tax and recurrent property taxation. She warns, however, that such a system introduces a host of decisions around expected ownership periods, future property appreciation and household finances. “Whatever is chosen there will be winners and losers and much grumbling,” she said, suggesting a temporary SDLT holiday for resident first-time buyers as a less radical intervention.
Greenwood’s priority for the next Budget was different again: tax developers that sit on land banks rather than starting construction.
‘Years, not months’ of certainty
There was also a traditional plea for policy certainty.
Sebastian Hipwood, co-founder of heritage home specialists Blue Book Agency, complained that repeated speculation ahead of fiscal events was itself causing would-be buyers and sellers to defer decisions. “Most importantly we need years of certainty on property taxation, not another six months until the next round of speculation,” he said. “We are currently stuck in a cycle ahead of every fiscal event where rumours about what the Government might or might not do cause people to delay decisions. Make the changes, set out the rules and then commit to leaving property taxation alone for a meaningful period of time – years not months.”
Any SDLT reduction would also have to take effect immediately, he argued, rather than being announced months in advance and creating an incentive for buyers to delay completion.
Robinson also flagged the damaging effects of uncertainty; “the prime market can absorb almost any tax regime,” he said. “What it cannot absorb is not knowing what the regime will be.”
What would you change in the next Budget?
Focusing on immediate issues resulted in rather less radical suggestions than many of the preferred long-term reforms.
When asked what one change to property taxation they would make in the next Budget, the most popular demand was just: cut Stamp Duty.
Daggers called for rates to be reduced “meaningfully”; Dell wanted substantial reductions across the board, particularly at higher price points; Bikhit called for lower higher-rate SDLT; Agace simply said “reduce Stamp Duty”; and Greaves advocated a “substantial, permanent reduction”.
Harris instead proposed a specific incentive for older homeowners to move out of under-occupied properties, while Tebb would combine lower SDLT with the ability to spread payments.
Robinson’s preferred first step was a credit scheme guaranteeing that SDLT paid from 2023 onwards could be offset against any future annual property tax.
Greenwood would tax undeveloped land banks. Small, meanwhile, favoured a temporary intervention for first-time buyers rather than wholesale reform.
Overall, the government’s current direction is pretty unpopular.
England currently combines a Council Tax system based on property values more than three decades old with transaction taxes capable of generating very large upfront bills at the top of the market. The new HVCTS on homes worth £2mn-plus (from 2028) will leave both pillars of the existing system intact. Which our pundits do not like.
The preferred route for reform is to tax ownership more rationally and movement less heavily – and to do it with certainty and a long view.
