Hammond may tweak his SDLT and EIS changes
Stamp duty and the EIS – not obvious bedfellows that always affect contractors, but already ‘hot’ contenders for inclusion in the chancellor’s Spring Statement 2018.
Reflecting after Philip Hammond’s cut to SDLT late last year, contractor mortgage advisory CMME said it was among Mr Hammond’s “boldest” moves on the personal finance front.
But the Royal Institute of Chartered Surveyors has found that the chancellor’s changes -- affecting property purchases of £300,000 and under -- are “having little immediate effect”.
As well as the 86% of estate agents who said the SDLT cut has made no difference, RICS said that initial “feedback” also suggested that it is not “going to have a material impact on activity” in the future.
Responses from London to Mr Hammond’s showpiece move are negative too, with reports that fewer than 6,000 houses -- not even 13% of the capital’s housing stock – can benefit.
Seeming to suggest that a tweak could spare Mr Hammond’s blushes, the House Simple website told The Telegraph that more than 20,000 'for sale' properties would currently benefit if the waiver was set at £500,000.
But it’s not just housing where the chancellor is under pressure to tinker.
His move in November to double the Enterprise Investment Scheme (EIS) threshold for some (-- changes were made to widen the definition of a ‘knowledge intensive company’), is being seen as good, but not enough.
The UK Business Angels association told yesterday's Sunday Times: “The current definition is too restrictive for the kind of knowledge-creating businesses which should be attracting investment.”
The association’s criticism follows a recent warning by its chief executive Jenny Tooth that the EIS must not go the way of Disincorporation Relief (axed by Mr Hammond in his last Budget).
“Removing this [EIS] tax relief [scheme] would we feel have disastrous consequences for the level of finance available from private individuals to early-stage businesses”, she said. “[Removal would result] in many companies failing to receive the finance they need to start up and build high growth businesses here in the UK.”