The pandemic has resulted in a significant cost to public finances. As the pandemic eases governments are seeking to raise taxes. Property is likely to remain a source of focus. From a UK perspective there have been a number of changes to the taxation of UK property in recent years. These have included:
• The profits of the development and investment in UK commercial and residential property being subject to UK taxation following changes which took effect from April 2019;
• Non-resident investors in UK residential property being subject to a 2% stamp duty land tax surcharge from 1 April 2021;
• UK corporation tax rates are due to increase to 25% from April 2023;
• The residential property developer tax
It is likely that further changes will be announced. From a global perspective, certain real estate investment vehicles are due to be exempt from the global minimum tax being proposed by the OECD and their wider impact and implementation should be reviewed by any large property group. Governments in many countries are also likely to look at property and the high asset values involved as a means of replenishing public finances, making global property tax an area to watch.