You are here: Home - Mortgages - Buy To Let -

Government urged to scrap stamp duty for additional properties

0
Written by: Anna Sagar
05/05/2022
The government is urged to ditch the stamp duty levy on additional properties as this tax measure is leading to a supply crisis and could damage home ownership goals, according to an association.

By scrapping the stamp duty levy on additional properties, nearly 900,000 new private rented homes could be made available over the next decade, according to the National Residential Landlords Association (NRLA), citing Capital Economics data. It added that this could lead to a £10bn boost to Treasury revenue.

The trade association explained that since 2015, the government has been making a “deliberate effort” to cut investment into rental housing, by taxing the supply of new homes to rent with a 3% stamp duty levy.

It added that the government has limited mortgage interest relief to basic rate of income tax, so landlords are taxed on turnover as opposed to profit.

The trade association said this was “fueling a supply crisis” as 62% of landlords surveyed reported heightened demand in Q1 this year, which it said was a record high.

Around 11% of landlords sold property, which compares to 8% of those who bought property.

It added that private rents had risen by 2.4% in Q1 this year, which is the largest annual growth since 2016.

Ben Beadle, chief executive of the NRLA, said: “Ministers have been repeatedly warned of the damage that would be caused if they continued to attack the private rented sector.

“The supply crisis is completely counterproductive to the government’s mission to turn renters into homeowners. By suppressing supply whilst demand increases, with rents going up as a result, they continue to make it harder for tenants to save for a home of their own.”

He added: “The chancellor needs to wake up to a crisis of the government’s own making, scrap the tax on new homes to rent and review other measures which add to a landlord’s costs.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Autumn Statement: Everything you need to know at a glance

Yesterday Chancellor Jeremy Hunt made his first fiscal statement in the role, outlining a range of tax measure...

End of Help to Buy: 10 alternatives for first-time buyers

The deadline for Help to Buy Equity Loan applications passed on 31 October. If you’re a first-time buyer who...

Moving to an energy prepayment meter: Everything you need to know

As households struggle with the soaring cost of energy, tens of thousands of billpayers are expected to move o...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week