The Scottish Government has unveiled proposals to introduce new council tax bands targeting high-value properties, with estimates indicating the measure could generate up to £16 million for local authorities annually. The initiative, announced as part of the government’s budget by former finance secretary Shona Robison, aims to establish additional tax bands for homes valued at £1 million and £2 million, to be implemented by April 1, 2026.

According to the government’s consultation document released on July 6, the current council tax system will largely remain intact apart from the creation of these new bands. Under the existing framework, councils set the rate for band D properties, while rates for other bands are calculated through a formula prescribed by ministers. The proposed changes would see properties valued at £1 million potentially subject to an additional £720 annually, while those exceeding £2 million could face an extra £3,600 per year.

Projections suggest that the new bands could raise between £12 million and £16 million, averaging roughly £500,000 per local council. The revenue generated is intended to be fully retained by local governments to support community services.

Deputy First Minister Jenny Gilruth emphasized the local benefit of the initiative, stating that the additional income would directly bolster services relied upon by communities across Scotland.

The proposal has drawn criticism from the opposition Scottish Conservative Party. Finance spokesman Craig Hoy described the plan as "performative," arguing that by focusing on a small segment of high-value properties, the financial impact would be limited and insufficient to address broader fiscal challenges.

The government has launched a public consultation to gather views on the specifics of the new tax rates and structure before finalizing the policy. If adopted, Scotland would become one of the few parts of the UK to implement a form of mansion tax through the council tax system.