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A report by officers of the South East England Regional Assembly describes the planning gain supplement as an opportunity to plug the infrastructure funding gap, which is holding back development across the region.

The report, which is being presented to the assembly's planning committee later today, says: "It represents the most positive attempt to address the infrastructure problem in more than 30 years."

It is, however, by no means a foregone conclusion that the assembly will give its support to this recommendation. This is because most assembly members are Conservatives and the David Cameron-led party has already made clear its opposition to the tax at a national level.

If the assembly does back the levy it will also put itself at loggerheads with the development industry, whose views are outlined in this week's issue of Regenerate.

The assembly's report says the planning gain supplement will provide more certainty to the private sector than the variant on a roof tax piloted in Milton Keynes by the Milton Keynes Partnership Committeee. This is because it is statutory rather then voluntary and will enable money to be raised in all parts of the region, not just the growth areas.

"This has more potential than a voluntary tariff," said Mike Gwilliam, the assembly planning director.

It is the most positive attempt to address the infrastructure problem in over 30 years

SEERA report

"It has taken an enormous amount of time to get anything off the ground in Milton Keynes and it only happened because English Partnerships has a large land holding."

But the report recommends a series of changes to make the planning gain supplement more workable. It says contributions for affordable housing ought to come out of the supplement instead of section 106 agreements, as the government's consultation paper proposed. It also says the supplement should apply to all sites, not just large plots.

Gwilliam added that the Treasury would have to ensure the sums raised were returned to the areas where they were levied. "If they don't do that, it will be dead in the water," he said. He said his position had won widespread backing among planners across the South-east.

But RICS policy director Michael Chambers said much would hinge on whether the Conservatives reversed their opposition to the tax. If they do not, many fear landholders will hold on to sites to avoid paying the tax, and wait for the result of the next election.