Stamp duty reform could bring another 130,000 homes on to the property market every year.
Raising the threshold at which the tax – officially known as Stamp Duty Land Tax – is paid would also boost the UK economy by around £6 billion, according to online estate agent Purplebricks.
Purplebricks has called on Prime Minister Boris Johnson to implement the changes to stamp duty that he floated during his run to becoming leader of the Conservative Party this summer.
Changes would increase activity
Mr Johnson had suggested raising the stamp duty threshold from its current lowest level of £125,000 to £500,000.
The levy is paid on a sliding scale by those buying property. First-time buyer relief means newcomers to home ownership don’t pay anything on the first £300,000 of any property transaction.
If the threshold rose to the suggest £500,000, stamp duty revenue for the Treasury would fall by around £3 billion.
But Purplebricks said the increased activity in the property market from stamp duty reform would raise around £1 billion for the Government.
Purplebricks asked homeowners about their thoughts on stamp duty. Around a third (29 percent) said it was the prime reason for them not to move home.
Get Britain moving
Vic Darvey, CEO of the estate agent, said: “We believe changes must be made to stamp duty to help get Britain moving.
“This would kick-start both the property market and the UK economy.
“Unless stamp duty changes, growing families are less likely to trade up to bigger houses even if space is tight, and older people are less likely to trade down, even though they may be rattling around empty nests.
“With almost a third of UK homeowners saying stamp duty is the biggest factor that stops them moving… we need the Prime Minister to deliver his planned changes to stamp duty to help boost the housing market and get Britain moving.”
Who has to pay Stamp Duty?
Anyone buying property or land in England and Northern Ireland must pay stamp duty if the value is more than £125,000.
First-time buyers in England are exempt from paying stamp duty up to a certain level. Read more here about first-time buyer stamp duty relief.
When you receive a quote for conveyancing services from Homeward Legal – remember you can call our team seven days a week on 0800 038 6699 – we will also explain what you are likely to have to pay on stamp duty, based on the price of the property you are purchasing.
Buyers only pay stamp duty once their transaction has completed. At that point their conveyancing solicitor makes the payment online to HMRC.