(Alliance News) - The UK Chancellor is reportedly planning to extend the stamp duty holiday by three months.
The Treasury announced last year that it would temporarily raise the stamp duty threshold from GBP125,000 to GBP500,000 for property sales in England and Northern Ireland.
But many people have been left scrambling to complete their transactions before the deadline of March 31, worried that if they do not, they could be left with a GBP15,000 tax bill.
The Times newspaper said it has been told that Chancellor Rishi Sunak – who has been urged not to end the stamp duty holiday – will use his Budget next week to move the deadline to the end of June.
A spokesman for The Treasury said they could not speculate on tax ahead of fiscal events.
A recent report by the right-leaning Centre for Policy Studies said the tax break had increased house sales to their highest level since before the 2007 financial crisis.
Data shows that after an initial decline in sales between April and June 2020, the number of transactions increased from 132,090 in the second quarter to 225,870 in the third quarter and 316,300 by the end of quarter four – the highest level since 2007.
The think tank's research shows that stamp duty revenues actually rose by 27% in the third quarter compared to the second quarter, from GBP1.1 billon to GBP1.35 billion, and suggests they will rise again in the fourth quarter given the continued increase in transactions.
The think tank is calling on the government to either permanently increase the threshold on primary residences to GBP500,000 – at a cost of GBP3 billion – or abolish it altogether.
Jethro Elsden, CPS data analyst and the report's author, said scrapping the holiday would be a "sledgehammer blow to the housing market".
Bridget Phillipson, Labour's shadow chief secretary to the Treasury, described the reported plans for a stamp duty extension as "another tax giveaway to second homeowners".
"These are the wrong priorities in the middle of the worst economic crisis of any major economy," she said.
"The chancellor should be taking action to protect family finances and secure our economy, not hitting them with tax rises while cutting them for landlords."
source: PA
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