Property Tax reform - don't stop at stamp duty, Boris Johnson urged

Prime Minister Boris Johnson has been urged to go further with property tax reform and not just stop at reducing stamp duty.

London Central Portfolio - an investment consultancy that closely monitors transactions in the capital, especially those of interest to high net worth buyers - says changing stamp duty would be a welcome stimulus to the market.

But there’s more to be done according to LCP chief executive Naomi Heaton: “It will be interesting to see if he also rolls back the proposed one per cent additional levy for overseas buyers, now that Philip Hammond has been shown the door at No 11 and No 10 wants to show the world that the UK is open for business.” 

LCP’s analysis has already shown earlier this year that HM Revenue & Customs will pocket £60m less than forecast from another levy aimed at higher end buyers, the Annual Tax for Enveloped Dwellings, which in 2017/18 showed an 18 per cent fall.

In addition to those taxes, LCP has now analysed the latest stamp duty returns to HM Treasury which show that SDLT receipts for Q2 2019 in England, Wales and Northern Ireland fell 5.4 per cent over the same period of last year.

Heaton comments: “With an increase of 8.2 per cent in stamp duty receipts and 6.8 per cent in transactions in Q2 2019, compared with the previous quarter, there must have been a collective sigh of relief from the Exchequer. 

“However, this modest bounce back follows an abysmal Q1, when receipts fell by over 26 per cent and transactions 21 per cent.

“To put a further dampener on this ‘good news’ like-for-like receipts and transactions compared with the same period a year ago, fell by 5.4 per cent and 2.9 per cent respectively.”