Stamp Duty Discussions

Scottish Government plans to replace stamp duty in Scotland will dominate talks at Holyrood today.

Last month, Finance Secretary John Swinney announced that homebuyers in Scotland will pay no tax on properties costing less than £135, 000.

Stamp duty is on course to be scrapped in favour of the Land and Building Transactions Tax after powers were devolved to Holyrood. A 2% rate of tax will apply to transactions between £135,000 and £250,000, while a 10% rate will apply to those between £250,000 and £1 million.

Widespread opposition towards the plan has been expressed and the issue will be discussed at Holyrood.

MSPs will be told the proposals risk damaging the housing market and placing family homes out of reach for thousands.

The Scottish Conservatives have described the move as an 'assault on aspiration', and a range of organisations in the industry have now echoed that criticism.

The Scottish Building Federation will tell committee members the move could have 'a negative impact on what continues to be a relatively fragile market' and that more of its members thought it would be a worse alternative to stamp duty.
 
It added: 'There may be merit in particular in looking again at the impact this is likely to have on property transactions valued up to £500,000.'
 
The Scottish Property Federation added: 'We are concerned at the higher value rates applied to residential property and we fear this will have a negative impact on those sections of the markets, with a potential knock-on consequence for those seeking to move up the property ladder.'
 
Scottish Conservative finance spokesman Gavin Brown MSP said:
 
"It is clear there is widespread concern about the negative impact of this tax.
 
"That's why the Scottish Government has to think again and give serious consideration to a reduction in the rate.
 
"No analysis has been done into the impact behavioural change might have on this, which would of course affect the amount of money the Scottish Government collects.
 
"Some of that could lead to market stagnation in an industry which is still fragile.
 
"This is a punishing tax which hampers those who simply aspire to move to a bigger family home, and that could have a knock-on effect further down the ladder.
 
"The SNP should be trying to ease the tax burden on families, not adding to it.
 
"We are not talking about a mansion tax which will only impact millionaires; this is people in their late 20s, 30s and 40s who are simply looking to take the next step."