The Government has raked in an extra £2bn in stamp duty thanks to the 3% surcharge on additional homes, according to new analysis by accountants Blick Rothenberg.
While HMRC’s latest stats show 1,204,730 transactions were recorded to the end of July 2017 – not far off the total seen in the year to 31 July 2015 (1,205,700) – the extra charge has boosted the SDLT take from £10.4bn to a whopping £12.4bn, which is about twice as much as expected.
The Treasury’s coffers may be spilling over, but Blick Rothenberg’s Robert Pullen has some concerns about the effects on FTBs: “Some of this increase could relate to general property price increases, but it is likely that the majority relates to the changes from 1 April 2016, which added an additional 3% SDLT for purchases of additional residential properties.
“The policy intention was always stated to be to realign the residential property market to make it fairer for first time buyers. It is becoming clearer, however, that as prices continue to rise, the measure has succeeded only in generating extra tax for HMRC, as well as a sluggish property market evidenced by the number of property transactions falling.
“The Government will need to urgently consider whether the additional 3% SDLT policy is helping achieve fairness in the property market, or if it is creating more problems than it is solving.
George Osborne by Ninian Reid (CC-BY-SA-2.0)