Tax changes mooted to spur housebuilding in Scotland

One suggestion is to vary the the Land and Buildings Transactions Tax and Scottish Building Safety Levy, which is set to apply from next year, on developers depending on whether they have built out schemes to an agreed deadline.

Another is to tax land allocated for housing under local policy but still lacking a planning application, though officials admit some sites will need consideration where there is not a clear route to delivery.

A third potential change is to bring in a tax on sites that have permission for homes but where progress in building is “evidenced to be unreasonably slow”.

The government admitted that creating new taxes would not be straightforward and would require working with local councils or with Westminster.

Scottish officials have also put forward plans for different interventions.

These include monitoring build-out rates more closely and axing planning permission for sites that miss deadlines; streamlining planning decisions for smaller schemes, including creating a fast-track process; and changing national planning policy to encourage more diverse schemes.

Ivan McKee, the public finance minister, said: “Since 2007, the Scottish government has supported the delivery of 141,000 affordable homes, including 101,000 for social rent.

“But we know that Scotland urgently needs more homes and planning permission is already in place for a significant amount of housing land. We need to encourage construction to start or re-commence on those sites.

“This consultation seeks views on how incentives, clearer expectations and – where appropriate – stronger interventions could help local authorities, developers, landowners and communities undertake and complete more housing developments, more quickly.

“It builds on existing work to tackle stalled housing sites, support public sector-led development and strengthen planning capacity across Scotland.”

The consultation is open until the end of April and can be viewed here.