No more Stamp Duty on properties worth less than £500,000?


Sep 13, 2014
No more Stamp Duty on properties worth less than £500,000?

Oh how we all wish this was true!

Unfortunately it’s not and although this topic is thrashed around on an annual basis, it looks as though it won’t come true for the foreseeable future.

You see stamp duty is just too big an earner for the government, so cutting this form of tax to this level would cost them and us, the tax payer, over £4bn! See what I mean – unlikely to happen!

However in the face of adversity, one lone crusader is doing her best to persuade the government that this tax is hitting first time buyers and families wishing to move up the housing ladder. Step forward this year’s advocate Conservative MP Anne Main for St Albans.

I say this year’s advocate because we have of course been here before; other MPs and lobby groups before her have tried and failed to change the thresholds but sadly so far to no avail. We should keep challenging the status quo though as this is an extremely unpopular tax.

In a House of Commons debate, Mrs Main said that stamp duty was initially levied on wealthy families but now the government is using it as a ‘cash cow’. ‘Here here’ I hear you shout!

“Taxes that I believe were originally designed for the wealthy home buyer now bring in so much money to the Treasury…I think it’s being seen as an untouchable cash cow – too big, too lucrative to tinker with,” the outspoken MP said.

“Collection of stamp duty in its current forms I believe enshrines inequality, denies fair access to home ownership and taxes aspiration”.

The Conservative MP went on to say that the tax is unfair as it disproportionately affects those in the South where house prices are higher and does not take into account whether buyers can actually afford to pay it.

“It’s discriminatory – unfairly targeting certain areas of the country regardless of ability to pay and that cannot be fair. It’s the ordinary families being clobbered the most by this tax”.
Strong words and sentiment indeed Mrs Main.

It’s easy to say that had stamp duty been increased in line with inflation since its introduction in 2000 that it would now only apply to homes worth at least £1.3m, but we are where we are and at the end of the day, no government is going to bring it back in line. The best we can hope for is some gentle tinkering around the edges.

So Mr Cameron, as a starter for ten, how about increasing the entry point to £200,000 and moving the next band to £300,000? Oh and you can through in a reduced rate of perhaps 2% for good measure.

 

Sound like a plan?


Ashley Shepherd is an Over 50s Personal Finance Expert

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