Scotland property tax revenue hits record £760m amid new council tax proposals

Scotland’s residential property tax revenue reached a record £760 million in the 2025/26 financial year. This 13 per cent increase in Land and Buildings Transaction Tax (LBTT) revenue is driven by rising house prices and higher transaction volumes. Currently, LBTT applies to approximately 70 per cent of home sales, up from just over half at its inception in 2015. A significant portion of this revenue is concentrated in high-value sales; properties sold for over £250,000 generate roughly 95 per cent of all LBTT revenue, while transactions above £750,000 account for 22 per cent of revenue despite representing only 1 per cent of sales. Edinburgh remains the primary driver of these revenues.

Separately, the Scottish government is consulting on proposals to introduce two new council tax bands for high-value properties worth more than £1 million and £2 million. Under these plans, properties in Band I could face annual bills of approximately £4,770, while Band J properties could reach £7,650. Propertymark has criticized the move, describing it as “simply tinkering with a system that needs fundamental reform” and warning that it could place an undue burden on older homeowners. The organization also raised concerns regarding the accuracy of property valuations and the availability of qualified valuers to assess high-value homes.