Conservatives slam planning gain tax and reveal their shared-equity plan

The party's housing spokesman, John Hayes, said the planning gain supplement suggested in the Barker Report was a "dangerous idea" that would hamper vital development.

He was outlining his party's housing policy in a speech that also pledged shared-equity schemes for first-time buyers.

"It is ironic that Barker argues for more housing development yet is also prepared to put barriers in the way of development," he said. "The planning gain supplement is effectively a land tax and could prevent land from becoming available for development."

The government is investigating how a planning tax could operate effectively and the Tories' opposition is likely to concern large developers. Many of them believe a planning gain supplement will be unworkable without cross-party support.

John Calcutt, chief executive of the country's 11th-largest housebuilder, Crest Nicholson, said developers would hold back land until a change of government occurred if they believed the tax would be repealed. "If the Tories said they'd repeal the supplement, then land supply would dry up," he said.

But Mark Lupton, policy analyst at the Chartered Institute of Housing, said he was surprised that Hayes had "rubbished" the proposal. "This report was carried out by an influential economist," he said. "I'm surprised the Tories haven't considered why Kate Barker felt the need to make the proposal."

Hayes also said a Conservative government would do more to help first-time buyers get a foot on the housing ladder in his speech on Monday outlining Conservative housing policy.

He unveiled a plan to extend shared-equity schemes which would allow people to purchase part of the equity in a house rather than the entire amount.

Unlike most shared-ownership schemes, this would apply to existing homes as well as new build, and mainstream lenders would provide mortgages.

Hayes said this would bring about an "equity revolution, enabling millions more people to buy their home".

He said only 37% of new households in England could afford a home, down nine percentage points from 15 years ago.

Rather than increasing affordability targets on new developments, Hayes said the Tories wanted to "help people afford the homes that are available".

"Promotion of shared equity will be at the heart of the Conservative Party's help for first-time buyers, key workers and other people currently struggling to fulfil their aspirations to homeownership," he said.