Healey rules out extending the 'mansion tax' to £1.5m homes after outcry over 'retrospective raid'

From the Newshound archive · first published 11 October 2026 · last updated 12 October 2026.

Chancellor John Healey has abandoned a proposal to extend Labour's mansion tax surcharge to properties valued at £1.5m or more, after warnings that the change would hit middle-class London homeowners hard. The retreat comes with his first Budget due on October 28, as the Treasury continues hunting for additional revenue. Shadow Chancellor Andrew Griffith pounced on the reversal, calling on Healey to meet five Budget 'tests' — among them a pledge of no new taxes, deficit reduction, and raising defence spending to 3% of GDP.

Healey had been thought likely to lower the mansion tax threshold from £2m to £1.5m in order to fill a gap in Treasury finances.

Griffith urged Healey to 'stop the tax ratchet', warning that Labour's first two budgets combined have put taxes on course to reach a level without precedent in recorded history.

City bosses cautioned Healey that pushing bank taxes higher risks pushing financial firms towards rival overseas hubs.