Government consulted on a £2,500 to £7,500 surcharge on English homes over £2m

The government opened an eight-week consultation on 19 May 2026 on the High Value Council Tax Surcharge, a proposed new annual charge on owners of residential property in England worth £2m or more, to apply from April 2028.

Homes would fall into four bands: £2,500 a year for homes worth £2m to £2.5m, £3,500 for £2.5m to £3.5m, £5,000 for £3.5m to £5m and £7,500 above £5m. Charges would rise each year with consumer price inflation.

The Valuation Office would revalue every five years, with the next revaluation in 2033. Local authorities would send the first bills in March 2028. The surcharge is forecast to raise about £430m a year from 2028/29.

The consultation covered how owners could challenge their band or liability: an initial eight-month period, then a standard six-month period. New homes would be banded on completion or from the day they are occupied, and improvements alone would not change a band until the home is sold, split or merged. Liability would sit with the leaseholder where the lease was first granted for more than 21 years.

The consultation foreword set a council tax band H mansion in Mayfair worth £10m, which pays about £2,100 a year, against a band D home worth about £400,000 in Darlington or Blackpool, which pays £2,400 to £2,600.

The consultation closed on 14 July 2026. The government has not yet published its response, and the surcharge is a proposal, not law.