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Fears of false boom as Darling hints at shelving stamp duty

Brokers have given a mixed response to hints from the Chancellor that he is looking at suspending stamp duty as part of a package of measures to help the mortgage market.

Speaking this week on BBC Radio 4’s Today programme, Alistair Darling refused to rule out speculation that a stamp duty suspension will be part of measures to be set out this autumn.

ARK Financial Planning director Phil Perry says: “It has got to be a positive for first-time buyers. Some people cannot afford housing prices that fall in between the £150,000 to £200,000 mark. It saves the client money and is a positive for the market.”

But Brentchase Financial Services mortgage specialist Mike Fitzgerald warns that a suspension could create a false market and instead a major policy overhaul is needed. “I am worried that this will create a false mini boom. It is a kneejerk reaction, there needs to be a much better policy, such as raising the threshold to £200,000,” he says.

LibDem Shadow Chancellor Vince Cable says: “The Government should not be trying to bribe people into buying houses in a falling market.”

The Council of Mortgage Lenders points out the shortfall in revenue from stamp duty will drop to around £3bn in the current tax year and says the Government should look at the opportunity for long-term reform.

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