A £2.5 million property in London and its equivalent in Edinburgh may look comparable on paper. Over the next decade, they could sit on very different tax bills - with London homeowners potentially paying £40,000–£50,000 more, simply for owning the property.

This is not about stamp duty or selling costs. It’s about what it may soon cost to stay put.

What’s Actually Being Introduced?

The so-called “mansion tax” is not a new wealth tax. It is a high-value council tax surcharge, proposed for residential properties valued at £2 million or more, due to take effect from April 2028.

Rather than reinventing the wheel, the government is bolting an additional annual charge onto the existing council tax system. It is familiar, relatively quiet and cumulative.

Crucially, it is not a UK-wide measure.

London Yes. Edinburgh No.

Council tax is devolved. Scotland controls its own property taxation framework, including valuation and banding. Westminster cannot impose an English council tax surcharge north of the border.

As matters stand:

  • London (England): the surcharge is proposed and costed.

  • Edinburgh (Scotland): no equivalent charge exists.

  • No legislation is in place to mirror this in Scotland.

That distinction is doing far more work than the headlines suggest.

A Worked Example: Edinburgh v London

Let’s compare like with like.

Scenario

A buyer is choosing between:

  • A £2.5 million flat in London

  • A £2.5 million home in Edinburgh

Both are owner-occupied, held long-term, and mortgage-free.

London (from 2028, based on current proposals)

  • Existing council tax (Band H equivalent): approx. £3,500–£4,500 per year

  • Proposed high-value council tax surcharge: assume £3,000–£5,000 per year (final figures yet to be confirmed)

Indicative annual property tax cost:

£6,500–£9,500

Over 10 years:

£65,000–£95,000, before indexation or future expansion

Edinburgh (current position)

  • Council tax capped at Band H

  • No high-value surcharge

  • No market-linked revaluation

Indicative annual property tax cost:

£3,500–£4,000

Over 10 years:

£35,000–£40,000

The difference:

£40,000–£50,000, simply for owning the London property

That gap is not theoretical. It is structural.

Why Prime Buyers Are Paying Attention

At the top end of the market, buyers think in decades, not tax years.

What matters is:

  • Predictability of the tax framework

  • Direction of political travel

  • Total cost of ownership over time

London remains a global city. But policy is increasingly nudging high-value residential property towards higher recurrent taxation.

Edinburgh, by contrast, currently offers stability alongside strong schools, international connectivity, cultural depth and relative value.

This is not about an exodus. But when two jurisdictions diverge, capital notices.

The Simpson & Marwick Take

This is not a mansion tax in the traditional sense. It is narrower, quieter and far more strategic.

England is signalling a clear direction of travel for high-value home ownership. Scotland, for now, is not following.

For clients weighing London against Edinburgh, the decision is no longer just about price per square foot. It is about policy risk, predictability and cumulative cost.

Over a decade, that difference could comfortably exceed £50,000.

And once buyers start thinking that way, behaviour follows.