The Treasury will provide an exemption from Stamp Duty transactions for all residential property where the cost of the house is no more than £175,000.
This relief will apply to transactions between September 3 2008 and September 3 2009.
The threshold increase ends weeks of uncertainty over what exactly changes the government would make to Stamp Duty.
At the beginning of August The Sun had alleged that the government was planning a Stamp Duty holiday. There then followed a long and drawn out period of indecision in which the government refused to clarify exactly what changes it was planning to make to the Stamp Duty regime.
Estate agency firms blamed the lack of government clarification on effectively bringing the housing market to a standstill over August.
But today’s threshold rise supports Mortgage Strategy’s long-standing Step Up Stamp Duty campaign.