Breaking Budget news

16 Mar 2016

Despite the Governments’ published ‘consultation’ on increasing stamp duty being almost ripped apart by criticism from a multitude of fronts, the Government has dramatically proceeded to hit home buyers with a 3% increase in stamp duty in today’s Budget.

Yet it was only in November that the Chancellor made a presentation to Parliament to “bring down bills for families” and

to explore “options to deliver better value and make the experience of buying a home more consumer-friendly”, hard working home buyers now face handing over to the Government the equivalent in tax as the cost of a motor car.

e.g       A property costing £250,000 now could face an additional £3,750 in tax.

A £500,000 property will attract £15,000 in additional tax

And £1m an additional tax bill of £40,000!

–       and in so many cases, after that same income was already taxed at 40% in the hands of the home owner.

With direct and indirect taxation ever increasing, the Government has once again raided the pay cheques of the citizens of England & Wales, and buying homes will become even more expensive.

In a nutshell, if a person purchases another residential property which does not replace their main residence, they can face this dramatic additional tax.

Whilst the Government’s original consultation over raising stamp duty was set to penalise all but first-time buyers, anomalies even there remain. Nurses, and teachers for instance who cannot afford to purchase property in so many areas of the UK – due to strict housing policies and under supply of land available for new homes – will face the extra tax if their parents purchase a property for them to live in. The very children who are the upcoming first time buyers.

Combine that with overly complicated and bureaucratic Help 2 Buy paperwork forced on conveyancers whose own charges increase to reflect this, and the housing market has once again taken a beating.

It does appear to remain the case that it is the estate agents, conveyancers, surveyors and mortgage professionals who are the ones who actually care to help home movers, and the housing market.