RISHI Sunak could axe stamp duty for six months on homes up to £500k in a bid to boost Britain’s housing market.
The temporary measure would remove tax on the purchase of homes at the lower end of the housing market to target those most in need of help following the coronavirus crisis.
The Chancellor is expected to announce the policy in his Autumn Budget.
Treasury officials are said to be looking at raising the threshold at which homebuyers start paying stamp duty.
Currently they don’t pay any stamp duty on the first £125,000 of homes, then 2 per cent of the value of the home up to £250,000 and 5 per cent on the next £675,000.
The Times reports that the threshold could be increased for up to a year in a bid to help first-time buyers in a difficult market.
That would enable some homes at the lower end of the London housing market to be taken out of stamp duty but crucially would take out hundreds of thousands of properties in the crucial ‘Blue Wall’ seats that handed Boris Johnson his huge election win last year.
First revealed in HOAR, sources say the proposals being looked at are only for a six-month holiday, designed to trigger demand.
One source familiar with the proposal said: “A six-month stamp duty holiday would save people lots of money, is very Thatcherite and would please Tory backbenchers.”
During the lockdown, Britons were told not to move house.
Under the Health Protection Regulations 2020, potential buyers can now legally be shown around homes and visit estate agents in England.
Speculative viewings where neither party is serious about the sale, are “seriously discouraged”.
It comes as property prices are expected to fall due to the coronavirus disruption.
The move would mirror the popular measure introduced by ex-Chancellor Philip Hammond in 2017 when he removed stamp duty for all first-time buyers on homes under £300,000 and £500,000 in London.
Another measure being looked at is removing stamp duty land tax (SDLT) on vacant land. The move is designed to take advantage of disused land to boost the development of new house-building projects.
Both forms of stamp duty cuts are unlikely to be announced in the economic statement Mr Sunak is giving next week, which will instead focus on the Government’s plan to tackle mass youth unemployment triggered by the coronavirus crisis.
Stamp duty land tax (SDLT) is a lump sum payment anyone buying a property or land over a certain price has to pay.
All house-buyers must pay stamp duty on properties over £125,000.
