Implement high value council tax surcharge on £2m+ properties (November 2025 Autumn Budget)

[MaxGhenis]

Summary

The November 2025 Autumn Budget introduces a new high value council tax surcharge on properties valued at over £2 million from April 2028.

Policy Details

From the OBR Economic and Fiscal Outlook November 2025:

• Effective date: April 2028
• Threshold: Properties valued over £2 million (in 2026 prices) as identified by the Valuation Office
• Surcharge bands:
  • £2m - £2.5m: £2,500/year
  • £2.5m - £3m: (intermediate band)
  • £3m - £5m: (intermediate band)
  • £5m+: £7,500/year
• Uprating: Surcharge amounts uprated by CPI annually
• Revenue destination: Central government (not local authorities, unlike standard council tax)
• Revenue: Expected to raise £0.4 billion in 2029-30

Behavioral Effects Noted by OBR

• Full pass-through of surcharge cost into property prices over time
• Price bunching just below each band boundary
• Reduced yield from SDLT and CGT due to lower property prices
• Some expected non-compliance and appeals
• Government consultation on reliefs, exemptions, appeals system, and deferral mechanisms

Implementation Requirements

Prerequisites

This requires a new property entity mapped to households to properly model:

• Individual property values within a household
• Band assignment based on property valuation
• Surcharge calculation per property

Parameters Needed

• gov.hmrc.council_tax.high_value_surcharge.threshold (£2m)
• gov.hmrc.council_tax.high_value_surcharge.bands (4 bands with thresholds and amounts)
• gov.hmrc.council_tax.high_value_surcharge.uprating (CPI)

Variables Needed

• high_value_council_tax_surcharge - calculated based on property value bands
• Property value input variable (or enhancement to existing property wealth variables)

Source

OBR Economic and Fiscal Outlook November 2025, Chapter 3 (Policy measures), paragraphs 3.42-3.44, Table 3.9

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[nikhilwoodruff]

@PolicyEngine is this outdated?

[policyengine]

Based on my research, I can confirm the issue is not outdated - the policy is real and was announced in the November 2025 Autumn Budget. However, the issue description has some minor inaccuracies in the band details.

Status: Not yet implemented in the codebase.

Verified policy details from official sources:

Property Value Band	Annual Surcharge
£2m - £2.5m	£2,500
£2.5m - £3.5m	£3,500
£3.5m - £5m	£5,000
£5m+	£7,500

Key corrections to the issue description:

• The intermediate bands are £2.5m-£3.5m (£3,500) and £3.5m-£5m (£5,000), not "£2.5m-£3m" and "£3m-£5m"

Other confirmed details:

• Effective from April 2028
• Uprated by CPI annually
• Paid by property owner (not occupier)
• Valuations based on 2026 prices via targeted Valuation Office exercises every 5 years
• Social housing excluded
• Revenue goes to central government, collected by local authorities
• Consultation expected early 2026

Implementation considerations:
This would require:

1. New parameters under gov.hmrc.council_tax.high_value_surcharge
2. A new variable high_value_council_tax_surcharge
3. Property value input (could use existing household wealth variables or a new dedicated input)

Would you like me to proceed with implementation?

Sources:

• GOV.UK - High Value Council Tax Surcharge
• Mortgage Solutions - Autumn Budget 2025
• Streets Accountants - High Value Council Tax Surcharge