Press
Mortgage Solutions 27th Nov 2006
Sort out Stamp Duty strife, say industry bodies
Trade bodies have again called on the Government to address the issues surrounding Stamp Duty, ahead of next month's pre-Budget report 2006.
The Council of Mortgage Lenders (CML) and the Building Societies Association (BSA) were united in proposing changes to the payment of Stamp Duty in their pre-Budget submissions to the Treasury. Concerns around the 'slab' structure of the tax were raised in both submissions, as well as the limited impact of previous increases in the zero rate threshold.
The CML described the Government's current policy as "clearly undermining its own efforts to help would-be home-owners", stating a quarter of first-time buyers in London were forced to pay higher rates of Stamp Duty. It repeated its calls for the introduction of a graduated system and more generous up-ratings of thresholds.
The BSA recommended a review of Stamp Duty and said consideration of the fairness of the tax should be paramount.
Chancellor Gordon Brown will deliver the pre-Budget to the House of Commons on 6 December. The Budget 2006, delivered in March, triggered industry criticism when it was announced the Stamp Duty threshold was to be increased by only £5000 (Mortgage Solutions, 27/3/06, p6).
Rob Griffiths, associate director at the Association of Mortgage Intermediaries, said it had not yet put forward its pre-Budget submission, but its general view was Stamp Duty had not moved in line with house price inflation.However, he warned: "I would be very surprised if we had any further change on Stamp Duty thresholds. I think the Government has gone as far as it wants to go in terms of the money it is making from Stamp Duty. It is unlikely we will see any movement on it in the near future."
Commenting, James Carter, IFA at Virtue Financial, said he believed there should be some sort of incentive for FTBs in terms of Stamp Duty but difficulties existed in terms of how this would be enforced and who would be classified as a FTB.
The CML also called on the Government to review the safety net arrangements for borrowers that fall into difficulties and publish turnaround times for local authority searches.