UK weighs 1% levy on homes above £2m ahead of Budget

Chancellor Rachel Reeves is weighing a new levy on high-value homes ahead of the Autumn Budget on November 26 that would charge owners one percent annually on the portion of a property’s value above £2 million, government and industry figures said. The proposal, one of several options under consideration to help close a reported fiscal shortfall, has prompted warnings from property experts, economists and developers about its likely economic and practical effects.

Under the most discussed version, a homeowner of a £3 million property would face an additional £10,000 a year. Analysts estimate the measure could raise a few billion pounds for the Treasury, with one assessment putting potential receipts at about £2 billion to £3 billion. The levy would hit a small share of homes nationally but would be heavily concentrated in London and the South East; Knight Frank data show only around 0.54 percent of homes in England and Wales exceed £2 million, but in Kensington and Chelsea nearly 18.5 percent would qualify.

Reeves has signalled she will prioritise growth while restoring public finances. Speaking at a business summit in Riyadh, she said, "I'm not going to do anything in the...