Boris Johnson urged George Osborne to close a loophole that allows rich foreigners to dodge stamp duty on purchase of expensive properties by treating the house as a company.

In a letter to The Daily Telegraph, London Mayor writes “It is all the more extraordinary that there is a billion lying on the pavement, under his very nose – and all that the Chancellor has to do is trouser it immediately.”

The stamp duty loophole allows wealthy foreigners to escape from paying stamp duty at 5% on property purchase by declaring the house as company and buying share in it. It allows rich people to save themselves millions of pounds in tax.

“It is a billion that is being currently lost to the people of this country, and which is owed to us by very rich people who have come up with all sorts of cunning schemes to avoid paying stamp duty on very posh houses; and the fact that they are not paying it is an utter scandal,” Johnson writes.

Calling the evasion of stamp duty a scandal, he said the government can raise £1 billion by proscribing this scheme. Boris Johnson advised that the cash raised after closing the stamp duty loophole can help build homes for people who cannot afford to live in London.

“People buying high value properties must pay their fair share,” said Exchequer Secretary to the Treasury, David Gauke in an interview, indicating the plugging of the loophole.