Treasury collects over £1bn a month in stamp duty
26 Aug 2014
The boom in property prices has seen the Government's stamp duty receipts reach exceptionally high levels, with house buyers paying £1.09 billion in stamp duty in July. Revenues from the duty have more than doubled in 18 months.
The July figure could be a record (receipts did exceed £1bn when the housing market peaked in August 2007, but at that time stamp duty on land was calculated together with duty on shares).
The current stamp duty rates are: 1% on sales between £125,000 and £250,000; 3% on sales of up to £500,000; and 4% on homes costing up to £1million. As house prices rise, so more and more buyers are pushed into the tax brackets. One in four home buyers now pay the 3% rate, compared to just one in 10 in 2003.
The stamp duty burden is particularly felt in the south east and London, where prices have risen faster than in other parts of the country. Although sales in London account for only 15% of all property transactions, London buyers contributed some 42%of the total stamp duty paid in 2013, according to Nationwide.
Many Conservative MPs wish to see Chancellor George Osborne raise the thresholds to prevent so many 'ordinary' buyers falling into the stamp duty net, with a back–bench debate on the issue in scheduled in Parliament next month.