A buying agent has given his backing to the prospect of a Stamp Duty and Inheritance Tax (IHT) cut during this week’s Autumn Statement.
Chancellor Jeremy Hunt is reported to be planning tax cuts in this week’s Autumn Statement, with Stamp Duty and IHT reforms on the agenda.
Liam Monaghan, managing director at London Central Portfolio (LCP), said momentum is needed in the property market after a long period of falling transaction volumes across England & Wales as well as limited price growth.
Only 538 houses in prime central London transacted over the past 12 months to August, this accounts for only 10 transactions a week, according to LCP research.
Monaghan said: “One way of kick starting this will be to encourage downsizers to leave their large family homes with a Stamp Duty incentive.
“Currently it is not economically viable for empty nesters to leave their large properties and owners simply hold onto their assets for longer than planned.
“A Stamp Duty cut would see a much-needed increase in stock and boost in transactions as large family homes, that are in high demand, become available for sale. This in turn will help create more stock for first and second-time buyers."
However, although a Stamp Duty holiday for downsizers would be “nice to have,” Monaghan said it’s not a long-term solution, adding: “Often with Stamp Duty holidays, transactions are simply brought forward and then we see a transaction lull once the holiday comes to an end.”
He suggested cutting Inheritance Tax not only would be a wise and popular move for the Conservatives just before a General Election, but it would also help the UK be more competitive on a global platform for overseas investment which will help boost the general UK economy.
Monaghan added: “It would also help build momentum in transaction volumes and price growth for the domestic market. This could ensure a kick start to the market, as a flat 40% tax for IHT will ensure lack of activity continues."
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No to a stamp duty holiday but yes to a total revamp of this awful "tax on homes". It should be cut, at least halved right across the board. The housing market is one of the biggest drivers of the UK economy
and when allowed to operate without this huge encumbrance, will be a boost with the many spin offs that it gives, avoiding the recession that is coming. At the same time, this will allow easier movement of labour and allowing people to get on with their lives. High taxation stifles everything.
I wouldn't propose either suggestion to improve the property market. Tax payers money shouldn't be used to prop up the property market just because things are a bit slow. If Jeremy Hunt has any spare cash to throw around I'd like him to stick it all on the personal allowance. Working people will keep more of their income and encourage saving. Raise the threshold to £18,000 p.a and find the money to do it.
What are you talking about tax payers money? This isnt NI or income tax. It's peoples families assets/homes that generations have worked hard for and the government is raiding. Tax should be found in other areas, not politicise family death.
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