Connect with us

Hi, what are you looking for?


Permanent cut to stamp duty ‘would generate £139m in tax’

Stamp Duty

The chancellor has been told that he can “have his cake and eat it” if he makes the stamp duty cut permanent, potentially generating a £139 million tax boost for the government.

Over the summer, the government scrapped stamp duty on house purchases of up to £500,000 until the end of March next year, meaning that buyers pay no tax on purchases and get a £15,000 discount on their payment on purchases over £500,000. Savills, the property consultancy, estimates that it was responsible for about £550 million of lost receipts to the Treasury in the three months to the end of September.

However, research from the Centre for Economics and Business Research on behalf of Kensington Mortgages, a specialist lender, suggests that a permanent increase in the threshold to £500,000 could reap £139 million of extra tax receipts a year. It is claimed that it would stimulate more transactions, would increase house prices and that there would be a fillip from more renovation work, such as new carpets and decorating, which typically come after a purchase.

There could be an even greater gain if the stamp duty threshold were permanently raised but to the lower amount of £300,000, it is suggested. That would likely still spur the housing market while drawing in more stamp duty receipts. The analysis shows that such a move could lead to an additional £491 million in revenue for the government each year.

“The threshold level should be considered ripe for permanent reform,” Mark Arnold, 52, chief executive at Kensington Mortgages, said. “The upper-bound estimates of our analysis suggest that the Treasury could have its cake and eat it, achieving a fiscal surplus whilst boosting the economy.”

Reflecting the impact of the stamp duty cut, coupled with a post-lockdown “rush to the country”, the number of house sales this year outside of London has surpassed the five-year average, according to Knight Frank, the upmarket property agency, despite the housing market being closed for much of the spring.

Zoopla, the online property portal, estimates that the value of house sales will surpass £300 billion this year, or 25 per cent more than in 2019. It believes that the number of people looking to move is up by 40 per cent compared with last year, which has helped to drive up property prices by 3.9 per cent over the past 12 months.

The jump has been fuelled by thousands of people looking to move into bigger houses with more office and garden space, as well as the bonus from the stamp duty changes. This has put a premium on houses, the average price of which has risen by 4.3 per cent, more than double the growth in flat prices.

Easing concerns among estate agents that transaction volumes will drop once the stamp duty holiday ends, Zoopla predicts that completions in 2021 will remain steady at about 1.1 million, while house prices in a year’s time are likely to be about 1 per cent higher than where they are now.

Read more:
Permanent cut to stamp duty ‘would generate £139m in tax’

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!



GROSS BORROWINGS by the National Government had reached P2.75 trillion as of end-October as it continued to raise money for its pandemic response, preliminary...


By Luz Wendy T. Noble, Reporter THE PHILIPPINE Statistics Authority (PSA) said the base year for the consumer price index (CPI) will change to...


SOME INDIAN COMPANIES, including those from the pharmaceutical industry, are interested in investing in economic zones in the Philippines, according to an India Business...


By Keren Concepcion G. Valmonte, Reporter HOSPITALITY GROUPS expect a rebound in tourism as coronavirus disease 2019 (COVID-19) vaccination rates continue to improve and...


BUSINESSWORLD’s Luz Wendy T. Noble was recognized as the Best Reporter of the Year for Banking at the 30th annual awards of the Economic...


THE Securities and Exchange Commission (SEC) has flagged eight more entities in separate advisories for their unregistered investment solicitation programs. These offerings are PH...

You May Also Like


Having a good Instagram marketing agency to back up your Instagram account is an absolute must going into the new year. With competition stronger...


Ivermectin, an existing drug against parasites including head lice, has had a checkered history when it comes to treating COVID-19. The bulk of studies...


As a traditionally rigid insurance industry becomes bogged down by antiquated processes and operations, a handful of industry leaders are seeking to shake things...


Insomnia is the most common sleep disorder in the global population. Therefore, it is a problem that many people suffer or have suffered throughout...

Disclaimer:, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartRetirementReport. All Rights Reserved.