Healey 'considers lowering 'mansion tax' threshold to £1.5m', putting ONE IN FOUR London homes in firing line

From the Newshound archive · first published 21 September 2026.

Chancellor John Healey is weighing a cut to the mansion tax threshold from £2 million to £1.5 million, a move that would more than double the number of homes caught by the levy to around 271,000. Two government sources confirmed the threshold change is a "live discussion" in the Treasury as Healey scrambles to find £10 billion before the October 28 Budget. The Iran war has sent borrowing costs soaring, leaving the chancellor under mounting pressure to adopt a more "aggressive" approach to taxing wealth.

Boroughs hardest hit would include Kensington and Chelsea, Westminster, Wandsworth, Hammersmith and Fulham, and Camden.

The original levy, announced by predecessor Rachel Reeves, hits homes over £2m with annual charges of £2,500 to £7,500 from April 2028 — lowering the threshold makes it far more punitive.

Experts at Tax Policy Associates warn Healey may go further still, reforming the levy's structure to extract even more from the Treasury rather than simply dropping the threshold.