A new report from the Adam Smith Institute lays out compelling reasons for the abolishment of the Stamp Duty Land Tax (SDLT) in the UK.
There are arguments to support the idea that stamp duty on the sale of property is jamming the housing market, forcing people to stay in houses that are too large for them, and preventing people from moving areas to access the jobs they need. The report states that stamp duty is the most damaging tax in the UK, and that the Chancellor should have scrapping it at the top of the agenda in the run up to November’s budget. Continue reading
Design and consultancy firm Arcadis has called for the country’s chancellor George Osborne to pause housing tax on high end luxury properties or risk distorting the wider market, writes development specialist Richard Carr.
Successive stamp duty hikes has seen buyer interest drop in the UK’s high end property market at a time when there had been a 40% rise in prime properties planned for development in London.
Many projects in development for a number of years have been disproportionately affected meaning that they delivery of affordable homes could also be put at risk.
The government appears to be giving mixed messages in relation to the market; initially they encouraged investment in prime residential property, but have changed policies mid-cycle, leaving developers in trouble.
Overall there wasn’t a big housing announcement as to how the government plans on solving the crippling issue of supply or the increasing house prices that are preventing many young people in the country own a home.
ISAs have been a popular tool in the government’s effort to show that its commitment to helping young people get on the property ladder. At this year’s budget it announce a ‘Lifetime ISA’ which would provide people under the age of 40 with 25% on top of any funds in the account (up to £1,000 per year).
Looking at the bonus against the rate of house price increases takes the shine off the ISA slightly. A saver could have achieved a maximum bonus of £5,000 by 2021 from the government however house prices are expected to raise by 25% by 2021, meaning that the average house would go up by £50,000.
This week the government announced new stamp duty rates commercial property in the UK, but who will benefit and who will lose out?
Property Developer Richard Carr believes this is another example of the government using the stamp duty to tax raid the industry. As with CIL and s106, Richard believes the government should be relaxing tax not making it more expensive.
According to propertywire.com, investors in large commercial property in the UK will see a rise in stamp duty rates, whereas buyers of smaller properties will benefit from a reduction in the tax payable.
As of today (March 17th) stamp duty will no longer be applied to the whole transaction fee, but to bands based on a portion of the fee.
Sales of super prime property in the capital decreased during the final stages of 2015 with critics pointing the finger at the rise in stamp duty implemented in late 2014, writes property specialist Richard Carr.
Sales of £10million plus homes in London supposedly fell by a third during the final few months of last year as increased transaction fees put buyers off.
Knight Frank, international real estate firm, saw super prime transactions fall by 16% during the same period that stamp duty increases were implemented. For example, under the increased stamp duty regulations the transaction tax on a £10million property rose to £1.1million from £700,000, which equates to an additional 4% on top of the sale price.
Further changes will be made to the system in Spring when a further three percentage point increase will be put in place for buy to let properties and second homes.