Make stamp duty cut permanent, international economists tell UK

The UK government has been told it should make the stamp duty cut permanent to encourage investment and make it easier for people to move to new jobs.

The advice - from the Organisation of Economic Co-operation and Development, a 37-country body aimed at stimulating the economy and growth - is contained in its Going for Growth 2021 report.

This says that the tax on property purchases of up to £500,000, which has been suspended until June and will be tapered to the end of September, should not be restored.

One agency has thrown its weight behind the idea.

Dominic Agace, chief executive of Winkworth, says: "Stamp duty should be permanently reformed. You only need to look at the property market since stamp duty was reformed in 2014 to see the story of a tax that has been overdone.  

“Since then, a period of record low levels of transactions occurred, with this trend being completely reversed by the recent stamp duty holiday.

"The level of stamp duty currently charged is detrimental to a healthy free flowing housing market and the subsequent benefits it brings to society and the economy.

“This doesn’t have to be complete reform. Shaving the extreme rates at the higher end, which affect many young families in London and the South-east and retaining the benefits the stamp duty holiday has brought to first time buyers would go a long way to ensure enough properties continue to come to the market to allow people to right size when they need to. 

“In London, the stamp duty holiday hasn't led to dramatic price increases. Property prices are driven by other factors. The excessive taxation from current stamp duty levels cannot remain to keep a lid on prices.”