The Infrastructure Levy powers and where they stand

The Infrastructure Levy exists as a set of powers in the Levelling-up and Regeneration Act 2023, not as a charge anyone is paying. The Act inserts a new part into the Planning Act 2008 allowing charging authorities in England to levy a charge based on the value of development, and it leaves almost every operative detail to regulations that have to be made before a single pound can be collected. As at September 2026, the Community Infrastructure Levy and section 106 obligations remain the system that applies to your appraisal, and anyone telling you otherwise is describing a plan rather than a law in force.

The powers taken in the 2023 Act

The relevant provisions sit in Part 4 of the 2023 Act, which inserts the Infrastructure Levy framework into the Planning Act 2008 alongside the existing CIL provisions. What the Act does is set the outer shape of the charge and then delegate the rest.

The outer shape has four features worth knowing. The levy would be charged by reference to the value of development rather than net additional floorspace. Charging would be mandatory for charging authorities in England rather than optional, which is the opposite of CIL. Authorities would be able to set differential rates and minimum thresholds through a charging schedule tested at examination. And the Act contains a right for authorities to require that part of the levy be delivered as on-site affordable housing, valued against the cash liability.

Everything else, meaning the valuation method, the point of assessment, the payment triggers, the relief and exemption regime, the treatment of existing floorspace and the appeal routes, would come through regulations. Until those regulations exist, the practical detail that determines whether a scheme is viable is unknown.

How a value-based charge differs from CIL

CIL is a rate per square metre applied to net additional floorspace, indexed annually, with liability fixed at the point work starts and a defined set of exemptions for self-build, residential extensions and charitable use. Its virtue is that you can calculate it at the land bid stage from the charging schedule and a floor area. Its weakness is that it takes no account of what the development is worth.

A value-based levy reverses both of those characteristics. It would flex with sales values, which in a rising market yields more and in a falling market yields less. It would also require a valuation at some point in the process, and the choice of that point is the whole argument. Assess at permission and you are guessing at the value of an unbuilt scheme. Assess at completion and the authority carries the cash flow risk, and the developer carries the uncertainty right through construction.

Neither option removes the need for Viability Assessment work. It moves the argument from whether a scheme can bear a negotiated package to how the gross development value is measured and what deductions are allowed against it.

What would happen to section 106

The stated intention behind the reform is that a broader levy absorbs most of what section 106 currently delivers, leaving a narrower role for site-specific obligations. Narrower does not mean gone.

Three categories are hard to replace with a tariff. The first is site-specific infrastructure, such as a junction improvement that only this development needs. The second is mitigation required for legal reasons, including habitats mitigation such as nutrient or recreational impact payments, where the obligation flows from other legislation. The third is anything requiring ongoing management, such as maintenance of open space or a travel plan monitoring regime.

Affordable housing is the interesting case. The in-kind mechanism in the Act is intended to keep on-site provision, but the tenure split, the transfer value and the timing of delivery all have to be defined somewhere. Until they are, an Affordable Housing Statement still has to be written against the adopted local plan policy, not against the reform.

Test and learn rather than a switch

The approach trailed for implementation is a phased rollout through a small number of authorities before wider adoption, with the intention of learning from early charging schedules. That has two consequences for anyone planning a scheme.

First, the transition would be long. Two neighbouring authorities could operate different systems for years, which matters for land buyers comparing sites across a boundary. Second, early charging schedules would themselves be tested at examination, with the same evidence base arguments about viability, benchmark land value and area-wide assumptions that CIL examinations produced. Our note on infrastructure funding statements is a reminder that what authorities actually collect and spend under the current system is published annually, and that record is the best available guide to what they will seek under any successor.

Risk for schemes with long programmes

A strategic site with an outline permission, reserved matters over ten years and phased delivery is exposed in a way a single-phase scheme is not. The questions to put to your advisers are narrow and answerable.

1. Does the existing section 106 fix the obligations for the life of the permission, or does it contain review mechanisms that could be reopened?
2. Would a later reserved matters approval or a section 73 variation be treated as a new liability event under whatever regulations emerge?
3. Where CIL has already been paid on an earlier phase, is there a credit mechanism?
4. Does the land contract allocate the risk of a change in the planning charging regime, and to whom?

None of those has a settled answer yet. What they do is put the risk on the table during negotiation rather than after it.

Where to check the position

Primary sources only. The Act itself on legislation.gov.uk tells you what powers exist. Statutory instruments made under it would appear there too, and their absence is itself the answer to whether the levy is live. Parliamentary material and written ministerial statements record announcements. The Planning Practice Guidance chapters on the Community Infrastructure Levy and on planning obligations describe the system that is actually operating. The PlanScope planning law timeline is a place to follow reform news as it develops.

Anything that reads as a summary of a summary should be checked back to one of those. Trade commentary is useful for spotting that something has happened, and useless as authority for what it says.

Watch two things in particular: whether draft regulations are laid, and whether any authority publishes a draft charging schedule for examination. The first tells you the mechanism is real. The second tells you what a rate might actually look like in a specific market, which is the number your appraisal needs.

Assumptions to use in the meantime

Appraise against the adopted CIL charging schedule and the council's published section 106 requirements, and treat the levy as a sensitivity rather than a base case. Where a scheme will be delivered over more than three or four years, ask your valuer to run a case with a higher total planning cost and see what it does to the residual land value. Record the assumption in the appraisal note so that whoever picks the site up in two years knows what was assumed and when.

And resist the temptation to price in a saving. Reform of this kind has repeatedly been announced, consulted on and deferred, and a land bid built on an expected reduction in planning costs is a bid made on a forecast rather than a charging schedule. If the levy does arrive, the transitional provisions in the regulations will matter more to a live permission than the headline rate.

This is general guidance, not legal advice; check the current position with your local planning authority or a qualified professional before relying on it. PlanScope provides AI-assisted draft reports for planning applications. Reports should be reviewed before submission. We do not guarantee planning approval.