Treasury officials have examined plans to cut capital gains tax as part of a move to address problems in the London housing market, it has been reported.
HM Revenue and Customs is said to have assessed the cost of the changes, which is expected to be millions of pounds.
Officials have been asked to look at slashing the top rate from 28 per cent to 20 per cent and cutting the charge for basic rate taxpayers from 18 per cent to 15, the Times reported.
Capital gains is paid on the return on a range of investments including second homes and buy-to-let properties.
Some believe cutting the tax will encourage people to sell, which may have the effect of slowing rapid house price growth particularly in the capital.
Chancellor George Osborne has suggested he is keen to make the change after the Tories were forced to raise capital gains tax as part of the 2010-15 coalition agreement with the Liberal Democrats.
But a spokesman refused to comment on whether the measure would feature in today's Budget, the Times said.
The Standard has contacted the Treasury for a response.
