Britain’s tax authority is preparing to send officials to inspect high-value homes as part of a sweeping reform to the council tax system targeting wealthy properties.
HMRC agents will assess architectural styles, bedroom counts, swimming pools, tennis courts, balconies and scenic views to determine whether homes should face higher tax rates.
The inspections are linked to plans announced by former Chancellor Rachel Reeves to impose a surcharge on homes worth more than £2m.
Properties valued above £2m would face an annual surcharge of at least £2,500, rising to £7,500 for homes worth more than £5m under the proposed changes.
The new tax is projected to deliver a £400m-a-year boost to Treasury receipts by 2030, though it is expected to generate a net loss before that point.
A Freedom of Information request filed by the Conservatives revealed an internal guide used by agents at HMRC’s Valuation Office Agency to determine how properties should be valued.
The Tories used the document to accuse the government of planning an “annex tax”, “penthouse tax”, “pony tax” and “scenic view tax” targeting aspirational homeowners.
The opposition has labelled a planned AI-assisted database, which will support inspectors in valuing properties, as “Big Brother”, a reference to George Orwell’s dystopian novel 1984.
Shadow chancellor Sir Mel Stride said: “Labour’s plan to tax bedrooms, bathrooms and balconies confirms they will stop at nothing in their search for new ways to squeeze families for more cash.”
Sir Mel added: “They are more than happy to invade the privacy of people’s homes if it means they can take more money from hardworking people.”
Sir Mel continued: “This is another Labour tax on aspiration, carried out through alarmingly authoritarian means. The Conservatives will resist these plans and fight to keep tax on the family home down.”
Conservative Party chairman Kevin Hollinrake described the plan to dispatch HMRC agents to private properties as “sinister” and a “huge invasion of privacy.”
Council tax bands have not been updated since 1992, making any revaluation exercise politically sensitive and potentially damaging for both Labour and Conservative constituencies.
Leaders of Wandsworth, Kensington and Chelsea, Richmond and Westminster councils warned that residents across those four London boroughs could absorb around £270m of the estimated £400m annual tax gains.
The new tax is set to come into force in April 2028, with some local councillors already voicing strong opposition to the government’s reform agenda.