With party conference season around the corner and the next Budget just a couple of months away, more industry players are taking the opportunity to lobby politicians for changes they’d like to see.
One of the most controversial topics in the property industry is stamp duty and each year there are numerous calls for stamp duty reform or abolition.
The latest to enter the debate is the Association of Accounting Technicians (AAT), which says stamp duty should be paid by the seller instead of the buyer.
The AAT is not the first to make this suggestion – previous calls in previous years have come from the Yorkshire Building Society and Glentree International.
According to the AAT, stamp duty should not be scrapped as it currently raises in excess of £11 billion for the government each year.
“It’s widely accepted that stamp duty adds a burden to any homeowners seeking to move – especially first-time buyers – because they must pay the tax as an immediate upfront cost together with finding a deposit, surveyors and solicitors fees and so on,” says Phil Hall, the AAT’s head of public affairs and public policy.
He says this stunts mobility and reduces the supply of new homes, subsequently adding to the ‘affordability crisis’.
Hall says that switching liability to the seller would be a ‘relatively simple’ way of solving these problems.
The AAT says that making sellers pay stamp duty land tax would help more people get on to the property ladder, help those looking to move up the ladder, increase the number of house purchases and maintain substantial multi-billion-pound revenue for the Exchequer.
It says also that those moving up the ladder – and therefore buying and selling a home at the same time – would be paying duty on the lower priced property they are selling and not the higher priced one they are buying.
“In 2014, it was suggested that sellers would pocket any stamp duty savings realised by reforms announced at the time, but this didn’t prove to be the case,” Hall continues.
“Likewise, I doubt sellers will add the whole cost on to the asking price if they have to pay stamp duty. Even if they do, the buyer will still benefit from a lower upfront cost as no tax is payable.”
He adds that downsizers are best placed to pay a little extra in stamp duty as they are most likely not to have a mortgage and to have significant equity.
“It could also be argued that once this has been in place for a few years, downsizers are likely to have benefitted from these reforms to have got to wherever they are on the property ladder.”
|Mortgages - Find cheapest. Rates from 0.98%. 1st time buyers, remortgages, self-employed, adverse & CCJ, Landlord buy to let. Compare now|
|Sell or Let Property FREE on Houseladder 0% no fees. Free property advertising. List 1 to 1000 properties to millions of buyers and tenants. Upgrade to a Premium advert for only £30 and sell or let your property FASTER! Create Ad|
|Make Money - Earn £250 to £2000+ per month part time. Get paid every month for work you do once. Work from home. Flexible hours. Free training. No experience needed. Major UK PLC company. Find out how >>|
|How To Save Property Tax - Updated Sept 2017 “How To Save Property Tax” is widely regarded as THE tax bible for property investors. The 21st edition has just been published (Sept 2017) and is completely up to date. Read now|