Opponents gather as British legislators back new tax plan

British members of parliament are supporting government plans to introduce a new development tax but surveyors, developers, businessmen and property agents are lining up against it.

The Parliamentary Communities and Local Government Committee published a report earlier this month supporting government plans to tax increases in land values that result from planning consent being awarded for development.

The MPs said revenue raised by the Planning Gain Supplement could encourage the building of thousands of homes by raising funds for infrastructure.

Critics say the levy could have the opposite effect, because developers would be taxed twice. Developers already contribute to local government reserves when they receive planning permission, through a system known as Section 106 agreements.

Under the government's proposals, these agreements would be scaled back but critics say this is not enough because many local authorities would want to extract as much as possible from developers.

'The proposed Planning Gain Supplement is nothing more than a double tax on developers who already pay out huge amounts for infrastructure and community facilities through the existing Section 106 agreements with local councils,' said Philip Davies, the chief executive of developer Linden Homes.