Newspaper article The Evening Standard (London, England)

New Stamp Duty Starting Point Is of Little Help to Londoners

Newspaper article The Evening Standard (London, England)

New Stamp Duty Starting Point Is of Little Help to Londoners

Article excerpt


GORDON BROWN doubled the level at which stamp duty becomes payable on property from [pounds sterling]60,000 to [pounds sterling]120,000 - but the move will do almost nothing to help first-time buyers in London.

Housing industry experts dismissed it as an "empty gesture" that would aid a minuscule proportion of purchasers in and around the capital.

Soaring property values in London mean that more than 98 per cent of buyers already pay more than [pounds sterling]120,000. They will not be helped by the Budget change.

The announcement comes after months of mounting political pressure on the Chancellor. Hard-pressed first-time buyers, in particular, claim they are unfairly penalised by the [pounds sterling]4 billion-a-year tax.

Ray Boulger, senior technical manager of mortgage broker Charcol, said: "This is such a typically empty gesture from the Chancellor. It does nothing for the vast majority of first-time buyers in London and the South-East. The only people likely to get any benefit are those buying on a shared ownership basis."

John Wriglesworth, economist at online property information provider Hometrack said: "It is far too little, too late - it should have happened five years ago. It is an unfair and irrational tax and a move from [pounds sterling]60,000 to [pounds sterling]120,000 is going to help a tiny number of people.

It's just a PR coup."

The threshold was last raised in 1993, from [pounds sterling]30,000 to [pounds sterling]60,000. Since then, average house prices in Britain have soared to almost [pounds sterling]180,000. In London the average is now [pounds sterling]262,000, attracting a stamp duty bill of almost [pounds sterling]8,000.

However, the move will be of huge help to home buyers in Mr Brown's own constituency of Dunfermline East, where the average first-timer pays about [pounds sterling]60,000, and the Prime Minister's constituency of Sedgefield, where first-time buyers pay an average of [pounds sterling]72,725.

Stamp duty, first introduced in 1694 to pay for a war with France, has become one of the Chancellor's fastest-growing revenue sources while public finances are under increasing strain. …

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