Monday, November 28, 2011

CML seeks extension for home seller subsidy

CML seeks stamp duty extension

Government plans to abolish the stamp duty reprieve for the cheapest properties could destabilise an already fragile market, the Council of Mortgage Lenders has warned.

Posted by mombers @ 01:07 PM (1615 views)
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4 thoughts on “CML seeks extension for home seller subsidy

  • Stamp duty land tax revenues have fallen massively, but they’re still considerable. They represent around 1% of the country’s total tax bill.

    SDLT receipts (two-thirds residential, one-third non-residential):
    2007-08 : £10bn
    2008-99 : £4.8bn
    2009-10 : £4.9bn
    2010-11 : £6.0bn
    Source: HMRC: Stamp Duty Land Tax [PDF]

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  • Here’s a nice graph showing the boom & bust in SDLT (doesn’t include recent recovery):

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  • SDLT is a stupid tax. Easily avoided (high end property is owned by offshore companies, no way to tell when it changes hands) and a penalty for moving, reducing labour mobility. LVT is of course a much better idea but a simple, revenue neutral change to a small annual charge would be a better way to ‘stimulate’ the market. Watch the small exodus of money laundering Greeks, Italians, etc from Prime London. Good riddance to bad rubbish! Once people see that an annual property tax is not the end of the world, LVT could become more politically feasible.

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  • Mombers, agreed. The general rule with taxes is that the closer they are to actual individual transactions or individual decisions, the more damaging the effect.

    So flat per plane payment is better than Air Passenger Duty, but auctioning off landing slots is better than per plane duty.

    Corporation tax on bank profits is better than Robin Hood/Tobin Tax, but bank asset tax is better than corporation tax.

    Corporation tax is better than VAT, and income tax is better than National Insurance, but Business Rates is better than corporation tax and LVT is better than Business Rates.

    Council Tax/TV licence is better than SDLT or CGT or IHT, but LVT is better than Council Tax/TV licence.

    And so on.

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