If this were effected, nobody would ever move. Already the cost of moving can be close to 100k in costs, so if you then get taxed at 50% capital gains on your primary residence, moving house would imply that you would lose a huge chunk of personal wealth. Mobility of labour is an important factor in dynamic economies, which would be wiped out with measures such as these. Why not just appropriate all property by the state and dole out houses according to need? With measures like this, you'd be effectively taking the open market out behind the shed and shooting it.