Association Of Accounting Technicians Propose SDLT Reform
HM Revenue and Customs (HMRC) have released statistics highlighting that more that 241,000 first time buyers have benefited from the exemption from paying Stamp Duty Land Tax (SDLT).
The relief, known as First Time Buyers Relief, saved FTBs £144 million in the final quarter, between October and December 2018.
The relief was claimed by 60,700 transactions in quarter four of 2018, a 3% increase compared with quarter 3 statistics.
Overall, first time buyers have now saved £570 million since its introduction on 22nd November 2017.
The government have also extended the scheme to include shared ownership properties and backdated this to include sales from November last year. This is expected to save FTBs an additional £5 million per year.
The overall saving to FTBs by the end of 2021/22 is expected to exceed £670 million.
However, the Association of Accounting Technicians (AAT) have suggested that this relief is expensive to the taxpayer and potentially detrimental to the housing market as it may lead to increasing house prices.
AAT have suggested an alternative system of switching the SDLT obligations from the buyer to the seller. They claim that this would be a fairer system as those moving up the ladder would be paying money on the lower priced property, meaning that all buyers would save with the exemption of those choosing to downsize.
Mel Stride MP, Financial Secretary to the Treasury, said: “These statistics show the value of government help for first time buyers. Over the last quarter 60,000 new homeowners got help to realise the dream of property ownership.”
Phill Hall, AAT Head of Public Affairs & Public Policy, said: “Switching Stamp Duty liability from the buyer to the seller isn’t a silver bullet for our myriad housing problems but it would make the system fairer because those moving up the ladder would be paying duty on the lower-priced house that they are selling, not the higher-price one they are buying. It would also remove every single first-time buyer from liability, irrespective of the cost of the house they are buying.
“It’s important to highlight that this change would save the taxpayer huge sums of money – almost £700m a year – whilst simultaneously protecting the billions of pounds Stamp Duty raises.”
Do you think that more thought needs to be placed into amending the current SDLT system? Is the FTBR causing more problems than the housing issues it is attempting to solve?