Tax revenue raised from both Stamp Duty on residential property and inheritance tax attributable to housing wealth is estimated to have risen almost five-fold since the early 1990s.
According to research by Halifax, Stamp Duty takings have increased from £735m in 1992/93 to £3.63bn in 2001/02.
The Government announced on Wednesday that it is going to be consulting on the shape of a new Stamp Duty regime for land and buildings due to be announced late next year, with an interim consultation covering both residential properties and commercial properties.
Halifax calculates that the Stamp Duty threshold (currently £60,000) would be raised to £118,500 if it were increased in line with the rise in house prices since March 1993, the last time that the threshold was increased. The inheritance tax threshold would be raised to £296,300, around £46,300 higher than its current level (£250,000).
Martin Ellis, chief economist for Halifax, says: “There is a growing number of homeowners who are facing a rise in their tax liabilities as the government continues to decline to index property related thresholds in line with house prices. We are pleased that residential properties will be included in this consultation exercise.”
Halifax's research also reveals that the average UK first-time buyer paid £97,207 to buy their home in the third quarter of 2002, compared to £45,249 in 1993. Based on the current Stamp Duty regime, the typical first-time buyer now has to pay £972. In 1993 the typical first-time buyer paid no Stamp Duty because the average price was well below the £60,000 threshold.