The Organisation for Economic Co-operation and Development (OECD) reported in early December that the UK has topped the rankings for the highest property taxes as a percentage of overall taxation in the developed world for the second year running. Tax revenues from property (both residential and commercial) hit £90.6bn during the financial year for 2019/20, up from £88.4bn in the previous period, it said.
The details mean the UK has seen the highest property taxes in six of the last 10 years, based on OECD data. In the UK, property taxes include all receipts from council tax, business rates and stamp duty. In Scotland it also includes land and building transaction taxes.
Further analysis from the real estate adviser Altus Group shows that tax revenues from property in the UK have risen by 47% since 2010, with £757.8bn having been collected across the UK during the last decade.
Total overall tax revenues for 2019/20 rose to £731.1bn in the UK, up £25.9bn on the previous financial year, with property taxes in the UK accounting for 12.4% of overall taxation – about £1 in every £8 of all taxes collected.
In second place was the US with 12.1% of overall taxation coming from property, followed by Canada at 11.6%, South Korea at 11.4% and Israel at 10.1%. As a percentage of GDP, property taxes in 2019 were again highest globally in the UK at 4.1% of GDP, compared to 3.0% in the US, 2.4% in Spain, 1.1% in Germany and just 0.2% in Estonia, according to the OECD report.
Shortly after the first lockdown, the Chancellor of the Exchequer, Rishi Sunak, introduced a stamp duty holiday for anyone buying a property below £500,000 in England. However, the tax break will end in April 2021 and Downing Street has said it will not be extended.