The Big Stamp Duty Tax Debate
It’s come to our attention that some of the country’s most popular newspaper publications are supporting the campaign to reform the current stamp duty tax system — recently being discussed within Parliament.
Many MPs and property experts are claiming the £1 billion a month claim is preventing effective recovery of the economy, and a rise in threshold could significantly boost the housing market. Questions are also being raised over the introduction of the Help To Buy scheme, and why the stamp duty tax system hasn’t been addressed with the same support.
The campaign follows a major surge in property prices, meaning households liable for stamp duty has more than doubled in the past decade. Within the next 3 years, official figures claim tax will need to be paid on around half of all homes, and is set to fluctuate to 80% of homes by 2018.
Recent figures have also shown more properties than ever are within the 3% tax bracket (worth over £500,000) and transactions exempt from stamp duty has halved since 2000.
In order to make a real difference, Chancellor George Osborne should plan to raise the stamp duty tax threshold from £125,000 to £500,000, ensuring only the wealthiest homeowners are liable.
Titled “mansion tax” by MPs, Liberal Democrats and Labour are the only parties promising to include the additional threshold, and apply an inflated tax percentage on homes over £2 million.
Conservatives have unsurprisingly been blaming the inherited tax regime from the previous Labour government, claiming unreformed thresholds have been pulling middle-income households into the tax net.
If stamp duty had remained in line with the house price surge, the current 3% tax bracket is estimated to have only be applied to homes worth over £1.3 million.
According to official figures from the Office for Budget Responsibility, if the current rates continue, treasury revenue from stamp duty is set to more than treble, to over £18 billion over the next decade.