One of the most respected figures in the industry, trainer and consultant Richard Rawlings, is suggesting that stamp duty should be paid by the vendor not the buyer.
His suggestion - in a comment left on a stamp duty story here on Estate Agent Today - reopens the debate just as much of the industry is calling for the current stamp duty holiday to be expected.
Rawlings writes:
“Why not have SDLT paid by the seller? For the following reasons:
And he asks: “What's the downside? (Apart from the fact that the seller would have higher apparent costs, which might put pressure on agency fees, unless deflected well by the agent).”
He concludes: “No matter who pays the SDLT, it all comes out of the same pot eventually! But it would seem more equitable for this to come from the seller.”
Rawlings is not the first figure to suggest a switch of liability from buyer to vendor.
Back in 2019, during the Conservative Party leadership election, Boris Johnson - ahead of becoming Prime Minister of course - hinted that he agreed with the trade group the Association of Accounting Technicians, which was calling for such a switch.
At the same time Conservative MP Sajid Javid - who was Chancellor before Sunak, and who became a supporter of Johnson for leader when he himself dropped out of the race - speculated in an interview in The Times that there could be a move towards sellers paying SDLT.
However, it appears that Javid spoke out of turn at the time: within 48 hours he had done a U-turn and denied that such a switch was an option.
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And no mention that upon the switch every homeowner will mentally readjust their assesment of their homes value.
All that will happen is a one year spike in home values.
Yes, long term it might ease passage into ownership but only by shifting 90% of the current stamp duty amount into a future mortgage liability.
In principle. Good idea.
In practice, again something that'll just inflate house prices, and ultimately increase borrowing levels.
So all the older people trying to release cash and down size will be hit hardest. And we will just see offers needing to be higher to cover this
glad to see richard coming round to our way of thinking !!! and of course the seller saves the tax on the property they buy - still not ideal though as transaction taxes are much less effective than usage taxes and stamp tax should be removed all together and a land value tax considered . This will increase market liquidity and flow.
Makes perfect sense to me.
I've always thought it was wrong. Why should a buyer pay a tax when it's the seller that has normally made money on the property. I know there are geographical differences but it makes far more sense!
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