Govt urged to make sellers pay stamp duty

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Yorkshire Building Society is urging the Government to reform stamp duty and make it paid by sellers, not buyers.

The lender says this would help affordability for first-time buyers and save those in England, Wales and Ireland an average £3,791, with Londoners saving £13,171.

Yorkshire will send a formal submission to the Government today on what should be included in the Chancellor’s Autumn Statement.

Those buying bigger houses would save £4,093 on average, rising to £9,762 in London.

A total of 225,200 first-time buyers paid stamp duty in the year to June, having bought a property above the £125,000 minimum threshold, representing 75 per cent of all first-time buyers.

The lender says its sellers paying stamp duty would lead to an extra 16,000 property sales in the first year of being implemented as a result of a 2 per cent increase in overall transactions.

Yorkshire says this would include 6,000 first-time buyers.

The lender says new build properties for owner occupation could be exempt from the rules, ensuring the supply of homes is not prevented by the additional tax.

Yorkshire Building Society chief economist Andrew McPhillips says: “More than 200,000 first-time buyers paid stamp duty last year and removing this tax burden from them would give the younger generation a major leg up the property ladder.

“The benefits would not only be felt by those looking to get on the property ladder as anyone moving up it would be better off too.

“The Prime Minister has pledged to make intergenerational support a key measure of her Government’s housing agenda and this measure could achieve exactly that.

“This will not solve every cause of the housing crisis but reforming stamp duty could ease its effects by making homes more affordable.”

Stamp duty generated £7.8bn for the exchequer in the year to June and a 2 per cent increase in completions would generate an additional £156m.