A potential replacement for stamp duty is being considered by the Treasury, which involves implementing a new property tax on homes valued at over £500,000. This proposed tax would be applicable to owner-occupiers upon selling their properties, with the tax amount based on the property’s worth and a rate determined by the government.
It is important to note that this new tax scheme would not supersede stamp duty on second homes. The final decision on the implementation of these plans is yet to be confirmed, as reported by The Guardian.
Any forthcoming announcements regarding these changes would likely occur during a fiscal event, such as a Budget presentation by Chancellor Rachel Reeves.
In the current system, purchasers in England and Northern Ireland are required to pay stamp duty when buying properties exceeding £125,000, with a lower threshold of £300,000 for first-time buyers.
A spokesperson from the Treasury emphasized the focus on growing the economy as the primary strategy to enhance public finances. They highlighted that tax and spending policies are not the sole methods for achieving this goal, citing planning reforms expected to boost the economy by £6.8 billion and reduce borrowing by £3.4 billion.
The commitment to maintaining low taxes for the working population was reiterated, as demonstrated by the protection of income tax rates and national insurance contributions in the previous budget.
Stamp duty rates in England and Northern Ireland are well-known, while in Scotland, it is referred to as the land and buildings transaction tax, and in Wales, it is known as the transaction tax.
