Tory leader David Cameron has launched an attack on the government's proposed planning gain supplement.
Speaking to an invited audience of housebuilders in his Oxfordshire constituency, Cameron criticised the tax on the grounds that it would add to the costs of developing without increasing housing supply.
He said: "The PGS is designed to help Gordon Brown fill his black hole rather than meet housing need."
Cameron said the government's moves to introduce the PGS underlined the gap between its commitment to increase housing supply and its need to raise revenue.
He said the Tories were looking at changing the planning regulations to make it easier to deliver housing. However, he acknowledged that this policy would clash with his party's commitment to increasing local democracy. The Tories have said they would return planning powers to local councils from the regional assemblies, which would be abolished.
He said: "We all understand worries over development that puts stress
The Treasury’s explanation of how the PGS will be levied could calm fears in the industry
Yolande Barnes, Savills
on the environment. We aim to provide homes that are beautiful in communities that are sustainable. There is a challenge for developers to provide more beautiful homes that tackle climate change."
Cameron added that he had been impressed by schemes developed by Redrow and Bellway and encouraged housebuilders to get in touch with Michael Gove, his housing spokesperson, who is reviewing the Tories' policies on development.
Graham Pye, chairman of Oxfordshire housebuilder JA Pye, welcomed Cameron's speech. He said: "It's a long time since we've heard a senior Tory party politician talk about housing in real terms. It's a welcome return to the real world."
Cameron's criticisms came as Treasury officials revealed they were not intending to make development costs liable for the PGS.
The PGS is designed to help Gordon Brown fill his black hole rather than meet housing need
Yolande Barnes, director of residential research at property firm Savills, said at last week's MIPIM conference that she had just had a meeting with officials from the Treasury's property tax team, at which they provided fresh details on how the levy would be calculated.
According to the PGS consultation document, published before Christmas, the PGS will be levied on the difference in value before and after planning permission is granted.
Barnes said that officials had told her that the pre-planning permission value of the site would include the cost of any infrastructure needed to develop it and a reasonable profit margin.
Barnes said: "The Treasury's explanation could calm fears in the industry that the PGS would deter development."