The government has announced that a new tax will be introduced on UK residential property developers in 2022. At this stage details are scarce, but as the government’s statement refers to the “largest” property developers paying the tax, it appears that there will be some sort of de minimis threshold before a developer is caught by it.
The government’s press release (a link to which is here) states that the new tax will raise at least £2 billion over a decade (i.e. £200 million per year), and it appears that (somewhat unusually for the UK tax system) this tax will be hypothecated, with the proceeds being put toward cladding remediation. There is however no suggestion that the tax will only be payable by those housebuilders which are responsible for buildings requiring that remediation (and whether or not it was compliant when installed) – on the basis that all housebuilders will benefit from a restoration of confidence in the UK housebuilding industry.
The government will consult on the policy design in due course and housebuilders should look out for the detail of the measure once that process begins.