Stamp Duty Reform: Every Proposal on the Table in 2026

Why Reform Is on the Agenda

Stamp duty land tax has been described by the Office for Budget Responsibility, the IFS, the IfG, and every major economic think tank as one of the most economically distortionary taxes in the UK system. Unlike income tax or VAT, which broadly tax economic activity, SDLT specifically penalises movement, making the housing market less efficient with every transaction it deters.

The housing crisis has added urgency. With housing completions well below target and the existing stock heavily underutilised (large homes occupied by empty-nesters who cannot afford to downsize), the pressure to reform a tax that directly impedes reallocation has intensified.

For the full history of how stamp duty rates have evolved, see our stamp duty history guide. The reform debate has intensified since the April 2025 threshold changes pushed more buyers into higher bands, with current rates now representing the highest effective burden in decades.

Where Things Stand Before the 28 October Budget

Updated 12 July 2026.

Since this guide was first published in March 2026, the reform debate has moved from think tanks into Parliament, without yet changing a single rate. Three developments matter.

• The Spring Statement passed without reform. Rachel Reeves left SDLT untouched in March 2026, as covered in our Spring Statement analysis.
• Parliament joined the reformers. On 9 June 2026 the cross-party Housing Committee recommended a Government consultation on alternatives to SDLT before the end of 2026, paired with council tax reform. The Government's formal response is awaited.
• The mansion tax is being designed, and is reported to stay at £2m. The consultation on the High Value Council Tax Surcharge closed on 14 July 2026 and the government is analysing the feedback. Press reports that the £2m threshold could fall to £1.5m, catching around 150,000 more homes, were never confirmed, and on 13 October 2026 the Financial Times reported that the Chancellor has decided against the cut.

With the Autumn Budget 2026 confirmed for Wednesday 28 October 2026, the familiar summer speculation cycle has restarted: the Treasury's seller-paid £500k property tax (covered below) is back in circulation, and reports of buyers pausing high-value purchases echo the hesitancy that dented transactions before the 2025 Budget. Nothing has changed in law. Every rate and threshold on this page remains as set in April 2025. We tracked what was confirmed against what was speculation in stamp duty at the Autumn Budget 2026. On the day, the Budget left every rate and threshold unchanged, as covered in Budget 2026: stamp duty unchanged.

Updated 15 September 2026.

Since then a housebuilder has added its own proposal, and the Treasury has rejected a related one. On 11 September 2026 Berkeley Group asked the Government to cap stamp duty at 1% for first-time buyers and for downsizers, and to remove the 5% surcharge on additional properties. Three days earlier, in a written response dated 8 September 2026 to a proposal for a downsizer relief, the Treasury said the government had no plans to introduce further relief for people looking to downsize. Neither changes a rate. Both are set out, with what a 1% cap would be worth, in Berkeley wants stamp duty capped at 1%.

Updated 27 September 2026.

In the last week of September three more calls arrived before the 28 October Budget. On 22 September the Shadow Chancellor restated the Conservative pledge to abolish stamp duty on homes. On 24 September the Resolution Foundation published a costed plan to replace council tax and stamp duty on main homes with a 0.7% annual property tax, set out below. On 27 September The i Paper reported a group of Labour MPs pressing for the same kind of swap. The Prime Minister's position is unchanged: on 27 July he ruled out changing stamp duty at this Budget. We track each item against what is confirmed in Autumn Budget 2026 and stamp duty.

Updated 6 October 2026.

At their conference in Birmingham, which opened on 4 October, the Conservatives restated the pledge to abolish stamp duty on main homes. The Shadow Chancellor also said a Conservative government would scrap the planned High Value Council Tax Surcharge, which he called Labour's “Family Homes Tax”. Both are opposition policies, and the details are below. We have found no new government statement on stamp duty this week, and every rate on this page is unchanged.

Updated 8 October 2026.

The conference closed on 7 October with Kemi Badenoch repeating the pledge, set out below. We have still found no new government statement on stamp duty, and every rate on this page is unchanged.

Conservative Abolition Proposal

At the Conservative Party conference in Manchester on 8 October 2025, Kemi Badenoch pledged that the next Conservative government would abolish stamp duty entirely on primary residences, with no price limit. It would still be charged on additional properties, on purchases by companies and on non-UK residents. The Scottish and Welsh Conservatives said they would do the same with LBTT and LTT if elected.

Because stamp duty rises with the price, a pledge with no cap is worth most where homes cost most. At the rates in force since 1 April 2025, a home mover would save £5,000 at £300,000, £15,000 at £500,000 and £43,750 at £1 million. First-time buyers already pay nothing up to £300,000, so their gain starts above that price.

Updated 27 September 2026.

On 22 September 2026 the Shadow Chancellor, Andrew Griffith, restated the pledge in the Daily Mail, writing that “stamp duty on your home” would be abolished in his first budget as Chancellor. That matches the original pledge, which has no price limit.

Updated 6 October 2026.

The party restated the pledge at its 2026 conference in Birmingham. In his conference speech on 5 October, Andrew Griffith listed “Scrapping stamp duty entirely on primary homes” among the party's tax plans and called stamp duty “a bad tax”, while saying a Conservative government would cut taxes “only when we can afford to do so”. In an interview with The i Paper on the opening day of the conference, the Shadow Housing Secretary, Katie Lam, said “My most hated single tax is stamp duty” and called it “a massive disincentive to downsize”. Neither gave a new cost or changed the scope, so the October 2025 estimates above are still the latest. For Propertymark, Timothy Douglas said scrapping stamp duty “would also remove a significant barrier to moving home and could help improve mobility across the housing market”. This is opposition policy: it would need a Conservative government to take effect, and it changes no rate today.

Updated 8 October 2026.

Kemi Badenoch repeated the pledge in her leader's speech closing the conference on 7 October: “So this is my guarantee: no stamp duty when you buy your home, no mansion tax when you live in your home, and no inheritance tax on your home when you pass it to your children or grandchildren.” The new announcement in the speech was on inheritance tax, which is outside the scope of this page. Reports of the speech give no new cost or change of scope for the stamp duty pledge, so the October 2025 estimates above are still the latest. This is opposition policy: it would need a Conservative government to take effect, and it changes no rate today.

Treasury £500k Threshold Tax

Separately from the Conservative proposal, the Treasury is reported (by The Guardian and Financial Times) to be examining a simpler replacement: a flat-rate transaction tax only on the portion of property value above £500,000. This would effectively exempt the vast majority of transactions while retaining revenue from the upper end of the market.

Under this model, a buyer purchasing a £300,000 property would pay nothing. A buyer purchasing a £700,000 property would pay 4-5% on the £200,000 above the threshold: £8,000-£10,000. Compare this to current SDLT of £25,000 on the same property, a significant reduction.

Use our stamp duty calculator to calculate your current liability and compare it against these proposed models.

A Proportional Property Tax

Several think tanks have proposed replacing stamp duty, usually together with council tax, with an annual charge set as a percentage of a home's current value. The Resolution Foundation's 0.7% model and the Fairer Share campaign's 0.48% model are covered below. This would shift property taxation from a transaction basis to a holding basis, fundamentally changing the economic incentives. The table below is our own illustration at a round 0.5% a year, not any single organisation's costed plan.

Supporters argue an annual charge would encourage older homeowners in large homes to downsize, because the recurring cost falls when they move to a smaller property. The Autumn Budget 2025 went a step further, introducing a High-Value Council Tax Surcharge on properties over £2 million from April 2028, a separate recurring levy distinct from any SDLT reform. The government did not adopt any stamp-duty replacement model at that Budget, so a proportional property tax remains a proposal rather than policy as of mid-2026.

Land Value Tax

Land value tax (LVT) taxes the underlying land rather than the buildings on it. Because land is fixed in supply, taxing it does not distort behaviour in the same way as transaction taxes. LVT is supported by the Liberal Democrats and Green Party, and has broad academic backing from across the political spectrum.

International models:

• Denmark: Land component of property tax has existed since 1922. Land is taxed separately from buildings, at higher rates. Danish land markets are notably stable and efficient compared to UK.
• Estonia: Reformed towards LVT in the 1990s post-Soviet transition. Tax on land value with no tax on buildings. Seen as successful in encouraging development and efficient land use.
• Australia: State-level land taxes operate alongside stamp duties. New South Wales and Victoria have active political campaigns to replace stamp duty with land tax. Some Australian states have begun piloting hybrid systems.

The Fairer Share 0.48% Proportional Property Tax

This is the model most often linked to Andy Burnham, who backed the Fairer Share campaign before taking office. It would abolish both council tax and stamp duty and replace them with a single annual charge of 0.48% of a property's value, rising to 0.96% for second homes, empty properties and homes owned by overseas buyers. Because the charge is annual and falls on the owner, it converts a one-off cost at purchase into a recurring liability for as long as you hold the home.

It is a proposal, not policy. On 27 July 2026 Downing Street called reports that the government was actively considering it “not true” and “pure speculation”, and the Prime Minister ruled out stamp duty changes at the autumn Budget. See our analysis of what the Burnham government means for stamp duty.

The Cost of Speculation Itself

One point recurs across almost every industry response, and it applies whichever proposal eventually wins: sustained speculation about stamp duty damages the market even when nothing changes. Buyers and sellers postpone decisions while they wait to see whether a better deal is coming.

There is a recent precedent. Through the months of speculation before the November 2025 Budget, London house prices were falling, and in the end that Budget left stamp duty untouched. London has continued to weaken since. Prices there were down 3.3% in the 12 months to July 2026, the weakest annual change of any English region and an eleventh consecutive month of annual falls (UK HPI, July 2026).

Tony Blair Institute Loan Model

The Tony Blair Institute for Global Change proposed a different approach: do not abolish stamp duty, but change when it is paid. In October 2024 it proposed giving buyers the option to spread stamp duty over 20 years through a government-backed loan, and restated the idea in April 2025. Its director of economic policy, Tom Smith, said that if the household moved within the 20 years it would not need to pay off the rest of the loan, which removes the upfront tax penalty on moving.

Resolution Foundation 0.7% Property Tax

Updated 27 September 2026.

On 24 September 2026 the Resolution Foundation, a leading UK living-standards think tank, published Home Economics, a roadmap for replacing both of England's main housing taxes. Its long-run goal is a single proportional property tax of 0.7% of a home's value a year, paid by occupiers and designed to raise the same revenue as today, with stamp duty on main homes abolished. Poorer households would get a rebate, and owners with a lot of housing wealth but little income could defer bills until sale.

What sets it apart is the order of events. It does not ask for stamp duty to be cut at the Budget. It argues that abolishing stamp duty on its own would be “a large giveaway to the best-off and to established owners”, and that simply announcing it would “gum up the housing market” and leave a £15 billion hole in the public finances. Its recommendations are:

• use the Autumn Budget to start building an up-to-date database of property valuations, which it expects to take at least two years
• reform council tax and stamp duty together, not separately
• commit to leaving stamp duty unchanged for the rest of this Parliament “to steady the housing market”
• announce well before any phase-out that stamp duty paid during the transition will count as a credit against future property tax bills
• set up a commission on residential property taxes

Its case rests on who pays too much today. Relative to the value of their homes, it estimates Londoners underpaid £3.1 billion in 2024-25, and that by 2030-31, 85% of households in the North East will be overpaying by an average of £710 a year. It also estimates that stamp duty prevents around 100,000 house purchases every year.

What the Evidence Says

The academic literature on stamp duty is unusually unified: SDLT is economically inefficient, and reform would improve welfare. But the evidence also contains important cautionary findings about how reform is implemented.

Scotland & Wales: Devolution Lessons

Scotland and Wales have already replaced stamp duty with their own property tax systems, providing real-world evidence of how devolved property taxes operate in practice. Both systems are more progressive than England's SDLT, and both have introduced higher additional-property surcharges.

Key lessons from devolution:

• Both Scotland and Wales generate less property tax per capita than England, partly reflecting lower average property values and partly different rate structures.
• Cross-border arbitrage has been limited. Despite different thresholds, buyers do not generally relocate across borders to exploit tax differences, suggesting the rate differential is not the primary driver of location decisions.
• Scotland's ADS has been raised three times (3% to 4% in January 2019, 6% in December 2022 and 8% in December 2024), suggesting devolved governments are willing to use property taxes more aggressively than Westminster.