Millions of UK homeowners are bracing for significant council tax increases following a major government shake-up that will see the nation's most expensive properties revalued.
The 'Mansion Tax' Details
The Office for Budget Responsibility (OBR) has revealed that 2.4 million of Britain's most expensive homes will be subject to revaluation under new plans. This council tax surcharge, being dubbed a 'mansion tax', will specifically target properties worth £2 million or more.
The OBR outlined the structure of the new charges, stating: "There will be four price bands with the surcharge rising from £2,500 for a property valued in the lowest £2 million to £2.5 million band, to £7,500 for a property valued in the highest band of £5 million or more, all uprated by CPI inflation each year."
Budget Implications and OBR Error
This new tax measure is projected to raise £0.4 billion in the 2029/30 financial year. Chancellor Rachel Reeves defended her Budget, asserting that because of it, "borrowing will fall as a share of GDP in every year of this forecast" and the government's fiscal headroom will double to £21.7 billion.
The announcement was overshadowed by an unprecedented error when the OBR accidentally published its entire economic and fiscal outlook document ahead of the scheduled Autumn Budget. Chancellor Reeves described the early publication as "deeply disappointing and a serious error on their part."
The OBR has since apologised and launched an investigation, calling the premature release a "technical error" in an official statement.
