Developers to pay 'roof tax'

A new tax is planned to ensure funding for schools and hospitals.

The "roof tax" will be paid by developers at a rate of about £20,000 for each home they build. The fees will be paid to councils, effectively for permission to build on land. The plans are being piloted in Milton Keynes and could be extended to other growth areas in the South-East if successful.

The levy of five per cent to 10 per cent of the cost of an average house could earn Milton Keynes ?60 million a year, which will be used to build schools, health centres and roads.

The tax does not require legislation and can also be applied to commercial developments.