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Stamp Duty is key concern pre-Budget

Monday, 20 April 2009 5:20 PM

A widespread request for Stamp Duty to be suspended has been voiced prior to the Chancellor's Budget decision on Wednesday.

A survey of FindaProperty.com users found 37 per cent of home buyers believe the government should suspend stamp duty in the Budget, on all property.

A further 18 per cent believe Darling should permanently increase the threshold of the tax, from £175,000 to £250,000. Overall, 58 per cent of those surveyed believed some reform of the tax would help them with the home buying process.

Michael O'Flynn, content editor of FindaProperty, said: "November's pre-budget report introduced a temporary increase in the starting threshold at which stamp duty is charged, which had a positive impact for some buyers.

"Rather than extending this holiday, we would hope to see this become a permanent feature and that the level is raised to reflect much higher house prices in London and the south-east. The average price in London is still £298,563. A starting threshold of £250,000 to £300,000 would make a lot of sense and reflect the reality of house prices."

FindaProperty's research also showed 19 per cent of home buyers were waiting for the budget before making a decision on buying or selling a property. With this year's Budget the latest in post-war history, it is possible the traditional spring upturn in property market activity may be later this year, according to the property portal.

The Association of Private Client Investment Managers and Stockbrokers (APCIMS) have also urged the Chancellor to reduce stamp duty in order to boost financial markets and private investment as well as the government's tax take.

David Bennett CEO of APCIMS, said: "APCIMS believes the reduction of stamp duty/SDRT would send a message to business and the public about the value placed by the authorities on saving and investing for the future. At a time when the UK needs to increase its savings ratio this is an important message.

"A reduction in stamp duty would stimulate investors to buy and sell more shares and bring the benefit of increased business to authorised firms. In addition it would make a valuable contribution to the liquidity of company shares. Such a boost to UK share trading would be a welcome 'shot in the arm' during these challenging economic times."

Nationwide have also condemned the tax, asking for the threshold to be raised.

Graham Beale, Nationwide's chief executive, said: "Nationwide has long called for a reform of stamp duty and we believe increasing the nil rate threshold to £250,000, and linking it to inflation going forward, will stimulate the housing market and help reduce the burden that stamp duty places on first-time buyers in particular.

"The time is now right for reform, as the current low level of housing market transactions means such changes would have a lesser impact on tax revenues than at the height of the market."

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