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Campaigners demand major reforms on Stamp Duty to raise transaction levels

Campaigners demand major reforms on Stamp Duty to raise transaction levels

The TaxPayers’ Alliance has upped its Stamp Out Stamp Duty campaign, calling for substantial reforms which it says would increase house buying and selling volumes.

In new research, it says that Stamp Duty Land Tax raised £6.1bn in 2011/12 with residential property accounting for £4.2bn of that total. This represents 0.8% of the £549bn of taxes raised in that year.

It also says that there is a clear, proven link between Stamp Duty and a decline in housing market  transactions.

Around 1.1m jobs are dependent directly and indirectly on the housing market, and the Alliance says the fall in housing activity has cost 80,000 construction jobs plus 80,000-100,000 other jobs.

The decline in transaction volumes and jobs has also cost the Treasury in excess of £1.3bn a year in lost Income Tax and National Insurance, while VAT  receipts are down by £1.75bn a year.

The TaxPayers’ Alliance is calling for the Government to consider three proposals, all designed to simplify Stamp Duty and reduce the burden on home buyers.

One proposal is that house purchasers only pay Stamp Duty above each threshold. A second proposal is to double the thresholds, which it says would exempt 77% of all transactions. The third proposal is to halve Stamp Duty rates.

Matthew Sinclair, chief executive of the TaxPayers’ Alliance, said: “Stamp Duty is an unfair double tax that stops young people buying a home and starting a family, discourages elderly people from downsizing and makes it harder to move to new places for new jobs.

“The Government could cut Stamp Duty with a limited impact on the amount of money going into the Treasury’s coffers, as lower taxes would encourage more people to move and therefore increase the number of transactions being taxed.

“Politicians should seize this golden opportunity to reduce the burden and make things easier for the hundreds of thousands of people looking to buy or sell a home each year.”