Home Owners Alliance call for changes to "dangerously flawed" Stamp Duty reforms
The HomeOwners Alliance have called for Stamp Duty reforms to be changed, saying they are “dangerously flawed” and could well backfire.
While the consumer group supports the policy in principle the group have pointed out that the complexity of the new regime could result in lost sales as the surcharge is applied for a number of what they call unfair reasons.
The unintended victims of the policy could be divorcees who still have a stake in their previous home, those who sell their houses before they buy and people who move for work and find themselves unable to sell.
Other unintended consequences could be purchasers putting second homes in children’s names to avoid the charge and people moving into new builds at paces dictated by developers, often pensioners moving into easy access retirement bungalows.
Paula Higgins, Chief Executive of the HomeOwners Alliance, said: “It’s great the government is trying to use stamp duty to help homeowners, but they have made a real hash of it. The ridiculously complex way they are planning to introduce the scheme will end up harming many of the very homeowners it is meant to help, and lead to widespread confusion among homebuyers.
“We are already being contacted by distressed homeowners who have worked out they will be caught by it, and not be able to buy the home they want to. Rather than push ahead with a well-intentioned but dangerously flawed scheme, it should go back to the drawing board and put it right.
In its respons to the consultation, the HomeOwners Alliance has suggested many remedies to iron out some of the worst problems with the proposals, but points out that almost none of the problems would exist if the government used the more simple system.
Ms Higgins said: “It is really simple – no one should pay the stamp duty surcharge if they are going to buy a home to live in, and homeowners need confidence that will be the case. However, if you are buying a residential property for any other purpose, you should pay the surcharge.”
The consumer group have called for the surcharge to be aligned with capital gains tax in the instances of propeties bought for another purpose other than primary residential use.