Government consults on Building Safety Levy


28 July 2021

The Government is consulting on its proposed Building Safety Levy for England and it is seeking contributions concerning:

1. Design of the Levy

2. Levy calculation

3. Potential housing supply impacts

4. Process and timings

5. Incentives and sanctions

6. Reviews and appeals

The levy will apply to buildings that are subject to the Building Safety Bill's regime for higher-risk buildings, at the second gateway of the Bill's new three-stage gateway system. The second gateway corresponds with the current deposit of plans stage of building control.

The gateway two levy was first discussed in February 2021, before being included in the Building Safety Bill when it was introduced to Parliament on 5 July 2021. It will operate separately, but alongside, the government's proposed UK-wide residential property developer tax (RPDT).

Two alternative methods have been proposed for how to calculate the levy: a charge per square meter of the entire internal floor plan or a fee per residential unit within the scope of the levy but it remains to be seen which will be preferred.

Importantly the Building Safety Levy will not apply to developers of social housing, as it is feared that it was disincentives the building of affordable units. Additionally, while the levy is only expected to impact developers on schemes producing 12,000-14,000 homes a year meaning the majority of developers will not be effected there are concerns that this will be passed onto the purchaser increasing the price of homes even more.

The consultation closes on 15 October 2021.

For further information, please contact Clive Adams via [email protected] or 0203 553 4879.

The content of this article is for general information only. It is not, and should not be taken as, legal advice. If you require any further information in relation to this article please contact the author in the first instance. Law covered as at July 2021.

Authors

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Jonathan Hulley

Partner - Head of Social Housing

+44 (0)1473 921779

+44 (0)7565 252966

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Stathis Kosteletos

Paralegal

+44 (0)203 553 4885

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