Responding to the consultation, which ended on 27 February, the firm pointed out that the proposals did not make allowances for charities, housing associations or others engaged in local regeneration. It also said that local accountability would be undermined as the incentive for developers to offer benefits to the wider community would be removed, with money raised from local developments going to central government.

Robert Field, partner at the firm, said: “This is a completely new, and potentially extremely unfair, property tax which in its current form will act as a serious disincentive for investment in environmental or other socially beneficial local developments.”

Put basically, the supplement would be levied when land received full planning permission for residential or commercial development. The land would be valued with and without planning permission, and the tax would be a percentage of the difference.

The Institute of Directors (IoD) described the tax as “thoroughly bad both in principle and in detail”, with its head of taxation, Richard Baron, saying it was “nothing short of taxation by the back door”.

The IoD has also called on the government to drop the proposals and instead clarify existing planning obligation rules and regulations.