Transport for London (TfL) is considering funding the £3.1bn Bakerloo line extension with a tax on landowners.
The proposed works would extend the line from Elephant and Castle to Lewisham via stations on Old Kent Road and New Cross Gate.
However, the project has been left unfunded with no indication from central government that it will foot the bill.
However, it was revealed today by New Civil Engineer that TfL is considering taxing landowners along the proposed route to pay for the line as they would likely benefit from increased property values from the extension.
A TfL spokesperson said the putative tax is just one of several options that the transport body is exploring in a bid to gather funding for the project.
“We are exploring all options in order to fund infrastructure projects to support the growth of London, including capturing a proportion of the land value that those projects would generate,” they said.
If the plan went ahead it would not be without precedent.
TfL previously levied large commercial properties in London to pay to raise more than £4bn in order to help fund Crossrail.
The Centre for London and the Adam Smith Institute think tanks said the landowner levy would make sense.
Adam Smith institute research associate Charlie Paice said: “Rather than relying upon central government handouts for infrastructure investment this land levy will mean that those paying are the ones who stand to benefit as the value of their properties go up.
“If land owners aren’t prepared to pay for a project which will further increase their property values – then why should they expect taxpayers from the rest of the country to stump up their cash?”
However, the low-tax lobby group the Taxpayers’ Alliance (TPA) took a drastically different view.
Harry Fone, TPA grassroots campaign manager, said: ”Imposing levies on homeowners who had no idea of the proposal when they bought would be deeply unfair.”