Currently, altering LTT rules often requires a full Bill in the Senedd – a process that can take six to nine months. The Welsh Government argues this is too slow, particularly when responding to UK tax changes or tackling tax avoidance.
To address this, ministers are considering:
- Annual Welsh Finance Bill – a regular law-making slot to update taxes, tied to the budget cycle.
- Standalone Tax Bills – introduced only when necessary, giving flexibility on timing.
- A “Provisional Collection of Taxes” style mechanism – allowing immediate changes to LTT rates or bands, subject to later Senedd approval, to prevent buyers rushing to beat increases.
Existing emergency powers under review
Since 2022, Welsh Ministers have had limited powers to amend tax rules by regulation in urgent cases – such as following UK tax reforms, closing avoidance loopholes, or responding to court judgments. These powers will expire in September 2027, unless extended. The consultation asks whether they should continue.
Crucially for agents, regulations can take provisional effect immediately, before being confirmed by the Senedd. This means rate or relief changes could apply to transactions straight after an announcement.
Knock-on effects from UK tax changes
One of the biggest issues is the speed at which Wales can react when UK taxes such as Stamp Duty Land Tax (SDLT) change. Adjustments to SDLT often require updates to LTT.
- Slow alignment risks confusion and transaction delays.
- Too much flexibility could create instability and uncertainty in the market.
The consultation is therefore focused on finding the right balance between responsiveness and stability.
Agents can also use Propertymark’s Stamp Duty and Land Tax guide to help clients understand the differences between SDLT and LTT during times of change.
What property agents need to know
If these proposals go ahead, property agents in Wales will need to be alert to:
- Rapid LTT rate or threshold shifts – with little time for clients to react.
- Alignment with UK reforms – ensuring Wales avoids market distortions.
- Uncertainty in planning transactions – buyers and sellers may be caught out if deals straddle new rules.
- Sharper client advice – agents will need to track Welsh and UK budgets closely to give accurate guidance.
Balancing stability and flexibility
The Welsh Government has set out four guiding principles: tax changes must be effective, flexible, proportionate, and provide certainty.
It is also asking whether new powers should be made permanent or remain time-limited. Permanent powers could provide greater long-term certainty, while time-limited powers might mean repeated reviews and disruption for the property market.
Next steps
Responses are invited from the property industry, legal professionals, and the wider public. Propertymark will respond on behalf of members, and thoughts or comments should be shared with the Policy Team at [email protected].
Responses will shape whether new permanent mechanisms are implemented, potentially through a White Paper and subsequent legislation.
