Land Value Tax (LTV) and Renewable Development
August 2026
This article is put together on the first day of Andy Burnham’s premiership. He is rumoured to be considering proposing a land value tax (LVT) based purely on the underlying value of the land i.e. not the buildings or structure that sits on it.
As Rural Chartered Surveyors who specialise in the energy industry, we are already having conversations with worried landowners on how this could affect the land under a solar scheme, battery project or wind asset.
What exactly is he proposing and is he that intent on it? Well it transpires that he first floated the idea back in 2010, brought it up again in an LBC interview in 2022, and in May 2026 said: “I’ve long been persuaded of the argument of a land value tax. I’m personally keen to see reform of council tax, it’s a highly regressive tax”.
In his LBC interview in 2022 he stated that he thought it to be “a very productive form of taxation that could discourage land hoarding”.
How does this knock on to landowners and what concerns do they have?
Firstly, the concern is that any land that is under option for a solar scheme will automatically have a significant value that could be taxed, regardless of whether the scheme comes forward or not. If this does progress or if clarity is not given there is the danger that some landowners could just stall on progressing and/or would want a significant option payment to cover them for this potential tax on land, that hasn’t as yet been utilised into an energy project.
The second concern would be that their land is now significantly more valuable than it was beforehand and they will have to find the cash to pay the tax when clearly, they weren’t expecting to. There is the possibility that the capitalisation of leases prior to an implementation of any such tax would be one option that landowners would progress. i.e. they would take a lump sum now and gift the right of income to a buyer of such an asset.
Thirdly, anyone structuring new option to lease agreements may try to have this problem picked up within the document itself i.e. push any landowner’s outgoings onto the developer and/or tenant.
This potential tax could cause issues and hesitations for landowners and until it is either dropped or pushed forward, will be a possible cause for delay in getting option and lease agreements over the line. Whilst this applies for generation projects such as wind, solar and battery, the same also applies for any largescale demand projects such as datacentres, EV and EHGV charging hubs.
There is not much anyone in the industry can do until more detail comes forward from the new administration.
