Property Development: Taxation

Treasury written question – answered on 1st November 2021.

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Photo of Lucy Powell Lucy Powell Shadow Secretary of State for Housing

To ask the Chancellor of the Exchequer, what assessment he has made of the impact on viability of development of the Residential property developer tax; and what steps he is taking to ensure developers do not use the tax to reduce their affordable housing or other infrastructure investment obligations.

Photo of Lucy Frazer Lucy Frazer The Financial Secretary to the Treasury

The Government has designed the Residential Property Developer Tax in a way that will minimise any detrimental impact on housing supply, including the supply of affordable housing.

In particular, taxing profits will help to ensure contributions are proportionate to economic returns and will help to minimise distortions that might come from alternative tax bases.

The new tax will not affect developers’ planning obligations, including obligations under Section 106 of the Town and Country Planning Act 1990.

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