The Scottish government is introducing a “mansion tax” on homes valued over £1 million from April 2028.
Similar to the tax announced for England and Wales in Rachel Reeves’ autumn Budget, it will be levied through higher rates of council tax.
Before this can happen, there will be a “targeted revaluation” of the most expensive Scottish homes and two new council tax bands introduced for properties worth between £1m and £2m, and those worth over £2m.
Ministers have yet to specify how much extra the owners of high value homes will pay under the new system.
The revaluation itself is expected to cost £5m.
The Budget documents say: “As well as providing revenue raising in future years, this policy commitment recognises the reality that some multi‑million pound homes currently face bills not materially different from far more modest properties and seeks to address that unfairness.”
AJ Bell senior pensions and savings expert Charlene Young says: “Estimated to affect fewer than 1% of Scottish households, two new council tax bands will be introduced for properties worth more than £1m from 1 April 2028 using up-to-date values.
“The rest of the council tax system and rates of stamp duty on property sales will remain unchanged.
“Although this might appear tougher than the England and Wales mansion tax, it is unlikely to raise much in the way of extra revenue for Scottish councils and is more about the message and optics of moving to what the Scottish National Party views as a fairer system.”
Bidwells head of operational living and chair of the Association of Rental Living in Scotland Iain Murray says: “The announcement of new high value council tax bands and a so-called ‘mansion tax’ sends a clear signal about where the Scottish Government is looking to raise revenue.
“It will be closely watched by the property sector as the detail on valuation, implementation and scope emerges.
“However, the bigger challenge in Scotland remains the housing emergency, which is fundamentally a supply issue.
“This Budget is light on measures that directly accelerate delivery, particularly in the rented sector where demand continues to outstrip supply in Scotland’s major cities.”
