Stamp duty and council tax should be scrapped and replaced with a proportional property tax, according to a new Centre for London report that says the switch could bring 79,000 extra homes a year into the market and raise another £912 million annually for social housebuilding.
The think tank argues that the current tax mix distorts moves, mismatches homes to households and pushes costs onto people at the point of transaction. Its proposed model would replace council tax and stamp duty on privately owned homes liable for council tax, with the charge paid by owners.
For landlords, the report matters because transaction taxes have become a bigger part of the investment equation since the surcharge on additional homes rose to 5 percent. Any serious debate about replacing stamp duty now goes straight to portfolio strategy, acquisition costs and exit timing.
Think tank says current housing taxes distort moves
Centre for London said its modelling used Land Registry transaction data, VOA dwelling stock data and UK House Price Index price data. It claims a proportional property tax would be fairer and more transparent, while also improving labour mobility and making it easier for households to move.
The report says abolishing stamp duty could free up 79,000 additional homes each year, including 24,000 three- and four-bedroom properties. It also estimates that first-time buyers would save an average of £8,593 in their first five years of ownership.
Landlords will read those claims through a different lens. Removing a large upfront transaction tax could improve flexibility for investors reshaping portfolios, but an annual ownership-based property tax would also raise hard questions about who wins and loses among existing landlords, especially in higher-value markets.
Higher-value landlords may watch this debate closely
This follows Landlord Knowledge’s recent coverage of April’s jump in property transactions and its report on landlord sales adding pressure to the wider housing market. The latest Centre for London intervention pushes the debate beyond near-term market data and back onto the tax structure sitting underneath landlord buying and selling decisions.
The report is focused on London, but the political argument will sound familiar nationally. If policymakers want more churn in the market and lower entry costs, stamp duty remains an obvious target. If they want a steadier and broader tax base, annual property taxation comes back into play.
That makes this a live issue for landlords even if the proposal goes nowhere immediately. A future reform package could cut purchase friction for some investors while raising recurring holding costs for others.
The full proposal appears in Centre for London’s housing tax reform report.
What this means for landlords
- If you are buying this year: no tax change is on the table yet, but the report shows stamp duty remains under pressure as a policy target.
- If you hold higher-value stock: pay attention to any owner-based tax proposals, because the trade-off may be lower entry costs but a larger annual bill.
- Watch for: whether ministers or London policymakers pick up proportional property tax ideas as housing affordability pressure builds.
- Bottom line: tax reform could help some landlords move more easily, but it would not be a simple tax cut story for the sector.
Editor’s view
Scrapping stamp duty is always popular in theory. The harder question for landlords is what replaces it, and whether lower friction at purchase ends up being matched by a more expensive annual holding cost.
Author: Editorial Team – UK landlord & buy-to-let news, policy, and finance
Published: 03 June 2026
Sources: Centre for London
Related reading: HMRC: April property transactions jump 53% year on year
