The Chancellor should look again at the nation’s stamp duty thresholds, an archaic tax structure which is distorting the housing market, says RICS as part of its 2014 pre-Budget statement.
The existing ‘slab’ stamp duty system taxes a percentage of a home’s purchase price according to which value bracket it happens to fall into.
For instance, a buyer purchasing a property for under £250,000 would pay one per cent of the price in tax, while a home sold for just |one pound more would generate a tax bill of three per cent.
This means that many buyers are financially unable to venture above the threshold and vendors may have to price their home below what they may otherwise have sold it |for.
RICS believes that the Government should consider a fairer, marginal rate to replace the current structure which sees few homes come on to the market at between £250,00 and £275,000 whether or not they are worth that price.
The Government should also consider adapting Help to Buy to suit individual regions’ needs.
Sixty per cent of RICS members surveyed believe that adjusting the scheme on a regional basis would make |the market more sustain-|able.
Furthermore, half of those who are in favour believe |that the funding should be limited purely to first-time buyers.
RICS would like to see the Government reassess the scheme with a view to providing the relevant help according to an individual region’s needs.
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