Osborne’s stamp duty rises threaten to tip property market over the edge
"When George Osborne, the Chancellor, announced a steep rise in stamp duty on residential property in December 2014 he might have anticipated a quick, easy win: cooling a hot market at the same time as tapping into a juicy new source of tax revenue.
Unfortunately, Land Registry data by Savills shows an 18pc drop in receipts in the first eight months of 2015 against the previous year, meaning the Exchequer is set to receive £870m less from stamp duty last year.
There are also other unintended consequences of the stamp duty hike, including profound implications for the development of new homes at the lower end of the market.
We have had the perfect storm in residential property, from the introduction of an “annual tax on enveloped dwellings” to offshore capital gains tax, from clampdowns on corporate vehicles buying property to the removal of buy-to-let relief.
Now we even have the prospect of base erosion and profit sharing imposed by the Organisation for Economic Co-operation and Development and the concept of a 3pc stamp duty land tax levy on second homes or buy-to-let properties.
These rises in stamp duty threaten to tip the property market over the edge. The new rates introduced in December 2014 were: up to £125,000 – 0pc; £125,001 to £250,000 – 2pc; £250,001 to £925,000 – 5pc; £925,001 to £1.5m – 10pc; above £1.5m – 12pc.
The principle underpinning UK home ownership is that you do not pay tax on the gains on your principal primary residence over the long term. However, with these stamp duty levels, this has changed. Imagine you are a homeowner/occupier who 10 years ago bought an apartment for £1m, have spent £500k on it, and it is now worth £2.5m. "
More from the source: Osborne’s stamp duty rises threaten to tip property market over the edge - Telegraph
AtW's comment: any increase in tax levels which results in reduction of overall revenue should be scaled back immediately and the people responsible for the tax should be put in jail for gross incompetence ...
"When George Osborne, the Chancellor, announced a steep rise in stamp duty on residential property in December 2014 he might have anticipated a quick, easy win: cooling a hot market at the same time as tapping into a juicy new source of tax revenue.
Unfortunately, Land Registry data by Savills shows an 18pc drop in receipts in the first eight months of 2015 against the previous year, meaning the Exchequer is set to receive £870m less from stamp duty last year.
There are also other unintended consequences of the stamp duty hike, including profound implications for the development of new homes at the lower end of the market.
We have had the perfect storm in residential property, from the introduction of an “annual tax on enveloped dwellings” to offshore capital gains tax, from clampdowns on corporate vehicles buying property to the removal of buy-to-let relief.
Now we even have the prospect of base erosion and profit sharing imposed by the Organisation for Economic Co-operation and Development and the concept of a 3pc stamp duty land tax levy on second homes or buy-to-let properties.
These rises in stamp duty threaten to tip the property market over the edge. The new rates introduced in December 2014 were: up to £125,000 – 0pc; £125,001 to £250,000 – 2pc; £250,001 to £925,000 – 5pc; £925,001 to £1.5m – 10pc; above £1.5m – 12pc.
The principle underpinning UK home ownership is that you do not pay tax on the gains on your principal primary residence over the long term. However, with these stamp duty levels, this has changed. Imagine you are a homeowner/occupier who 10 years ago bought an apartment for £1m, have spent £500k on it, and it is now worth £2.5m. "
More from the source: Osborne’s stamp duty rises threaten to tip property market over the edge - Telegraph
AtW's comment: any increase in tax levels which results in reduction of overall revenue should be scaled back immediately and the people responsible for the tax should be put in jail for gross incompetence ...
Comment