Property coalition calls for abolition of Stamp Duty
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A property coalition has called for Stamp Duty to be abolished, slamming the property tax as a relic that fails to reflect the modern UK housing market.
The coalition has been formed out of a joint campaign from the National Association of Estate Agents and the Association of Residential Letting Agents.
The campaign from the two trade bodies has been called the 1808 Coalition, named after the year the tax was first introduced on UK property sales.
Stamp Duty urgently needs to be reformed, the coalition says, as its tiered structure unfairly distorts the housing market.
Currently the duty does not apply to properties with a value lower than £175,000, but this temporary reprieve is due to come to an end at the end of the year.
There have been calls to keep the Stamp Duty threshold at £175,000 permanently.
Peter Bolton-King, chief Executive of the NAEA, says that as well as being a barrier to entry for many first-time buyers and home movers, the tax also unfairly penalises buy-to-let investors.
This is because landlords have to pay Stamp Duty on their purchases in bulk, rather than paying it for individual properties.
Bolton-King says: “The time has come to reassess Britain’s most unpopular tax, which is a levy on those aspiring to own their own homes and is manifestly perceived by all those who pay it as being unfair and punitive.”
He adds that that the duty has become increasingly outdated as tax thresholds have not been raised in line with property prices.
The tax yield from residential Stamp Duty has grown ten-fold since 1996/97.
Between 1997 and 2008 receipts from Stamp Duty grew from £675m per year to £6.68bn.
London accounts for 11.5% of the UK’s residential property transactions, yet represents 29.4% of Stamp Duty yield.
But the East Midlands has 7.3% of transactions, yet only makes up 3.6% of Stamp Duty yield.
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