Labour’s proposed Mansion Tax will slow the entire housing market – and could cost some 250,000 home owners to pay for surveyors to assess whether their properties are worth more than £2m.

Knight Frank said that these home owners would face fines of thousands of pounds if HMRC disagreed with the valuations they submit.

Penalties are likely to be 30% of the tax that HMRC decides that the home owners owe.

There is also concern that a shortage of surveyors would exacerbate worries for home owners, who are likely to include asset-rich but cash-poor pensioners who have lived in their homes for many years.

Meanwhile other Labour plans on housing announced this week have also come under fire.

The Residential Landlords Association said that Labour’s plans for the private rented sector would sound ‘a death knell’ for the industry.

The RLA warned that the extra regulation announced by Labour at this week’s conference would significantly damage “the only sector that is boosting the supply of places to live”.

The RLA condemned proposals for :

• A national register of landlords. The RLA said that the last Labour Government described a full register of this kind as “onerous, difficult to enforce and costly”.
• Rent controls. The RLA said that the last Labour government had launched a consultation which made clear that the last time rent controls were introduced they seriously undermined investment in the sector.
• Banning so-called revenge evictions with costly new legislation. This is despite the fact that the Competition and Markets Authority has made clear that this is already illegal.

Alan Ward, chairman of the RLA, said: “The figures show that private landlords are the largest single investor group in the UK housing market. Without the increase in rented dwellings we have seen, the current housing crisis would be more like an Armageddon.

“Sadly, Labour just does not get it on rented housing.

“Rather than supporting the sector to meet the ever-growing demands being placed on it, shadow ministers are looking to make cheap political points by reaching for populist regulations without thinking through their consequences.”