Experts from the London school of Economics urge to reduce stamp duty

More and more calls sounds in the direction of the UK government to reduce the tax burden in the form of stamp duty on the purchase of residential property. According to many experts, the tax reduction will help young first-time buyers buying a house, and for those who want to reduce the size of your home.

Now the minimum threshold value of real estate in England and Wales, from which you have to pay stamp duty – £125000, this means that stamp duty will pay everything. In addition, investors and those who buy a second home must pay an additional 3%, which is very significant burden in terms of uncertainty in the market.

Extremely high stamp duty leads to a distortion of fair prices in the market. In addition, the crisis in availability of residential property in England is not solved, and has even increased in connection with the shortage of affordable housing and lack of people’s motivation to move due to the excessively high tax rates. Potential buyers are staying in rented accommodation, and those who want to move into housing in a smaller area or home is large in size, also lay their moving often because of high stamp duty. Several experts noted that the decline in stamp duty will not reduce revenues because the market activity compensates for any decrease.

In a new report from the London School of Economics and Institute for Economic Research VATT emphasizes that the current stamp duty restricts the movement in the property market in the UK by about a third, preventing the release of housing for young, growing families – the most active part of the population.

® Helen Entree. 21.08.2017 G.

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