Falling house sales behind big drop in stamp duty income
Overall stamp duty receipts for April came to £1.2bn, down by £700m from the same period a year earlier.
HMRC noted that the majority of this change ‒ £500m ‒ was specifically down to stamp duty land tax, and the fact that the month saw a lower level of property transactions compared with the same point in 2022.
The taxman also said that it was impacted by “the lower rate of taxation and more generous relief for first-time buyers that were introduced in September 2022”.
‘Property plans on pause’
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, noted the property market has been “teetering on a precipice for quite some time”, with the cost-of-living crisis starting to bite. As a result, some are putting their property buying plans on pause.
“We’ve seen rates start to come down, but people are still feeling nervous – inflation remains high and the pressures on people’s budgets haven’t eased which led to lower transactions in April,” she continued.
“It’s still very much a case of watch and wait with regards to which way the property market will go in the coming months.”
Stamp duty down after record year
While stamp duty was down in the month, this comes after stamp duty receipts hit a record high for 2022-23 as a whole. Previous data from the taxman found that £15.4bn was paid overall during the tax year, up by nine per cent on the year before.
Stamp duty has also been a focus for ‘ambulance chasing’ legal firms, pushing buyers to see if they can obtain a refund on the tax paid following a purchase.