I was absolutely socked when I read an article in the paper this week about pressure on the Chancellor Alistair Darling to freeze stamp duty
Most investors moan about having to pay stamp duty which is currently 1% for purchases from £125,000 to £250,000, 3% on purchases between £250,00 and £500,000 and a whopping 4% on purchases over £500,000. Having said this I have many clients in Ireland where the stamp duty goes up as high as 9% for some investment properties!
The government has benefited from a stamp duty bonanza over the last decade as the number of purchases has dramatically increased which has also driven up the value. In 1997 when labour came to power, stamp duty was worth approx £675million a year. 10 years later it is worth a whopping £6.4 Billion. All this money just goes into the general pot. Talk about stealth taxes! But as the market is slowing there are increasing calls by industry experts for the Chancellor to suspend stamp duty on properties up to £250,000 in value as this may help to kick start the housing market and help out the first time buyers who always seem to struggle to get on the housing market no matter what is happening to prices. We shall have to wait and see with crossed fingers what Mr Darling does in his Budget.