Having had delivery of the 2017 Budget, and the opportunity to digest all the facts and content, there is arguably one major area that has been ignored completely – stamp duty.
In Autumn 2015, a new stamp duty regime was introduced that saw a series of bandings that became applicable on house purchases. The result was a saving for the bulk of buyers of properties in the lower price brackets but a huge increase in the duty payable for those buying the more expensive properties, especially above £2,000,000.00.
The changes coincided with other factors such as the strength of the £ at the time, alterations to the taxes payable by foreign investors, the then looming prospect of Brexit. The combination of these changes resulted in the market in Central London going through the floor with a ripple effect out to the provinces. Sellers of the big properties in Central London often look to move out to the provinces so fuelling the market above £2,000,000.00 in the Home Counties and South East of the UK.
The 2016 introduction of the complicated 3% stamp duty for second home purchases has exacerbated the sluggish market.
The recent budget gave the Philip Hammond the opportunity to juggle with stamp duty to try and give the top end of the market a boost, which in turn would have boosted the lower and middle range. First time buyer incentives, akin to those in 2010, would have done so.
Stamp duty is a huge earner for the government and so something creative that could have fuelled activity in the market would have not only benefitted the government and, therefore, each and every one of us with more financial resources available to spend, but also buyers and sellers of properties in what remains a semi stagnant market.
An opportunity has been missed, and the concern will be whether or not the next opportunity, the Autumn statement, will be missed again.
This is not legal advice; it is intended to provide information of general interest about current legal issues.