How do Government justifiy Stamp Duty?

Whatever_2

One thing I'd really like an answer to from any party is "What is stamp duty for". Council tax we pay because I accept certain public services need to be paid for, but I'd love to hear how any politician can justify the reason for us paying stamp duty. We don't get anything for it. It's simply a case of "So you've work hard to be able to consider purchasing a home have you?, in that case we'd like some of your money for no reason whatsoever, other than because we want to rob you, because we are the Government and therefore we can".

What happens to the Stamp Duty we pay? Please explain how the public benefit from our Stamp Duty payments?

Can't believe nobody has asked the Government to explain this.

JA1000

All goes into one pot, hopefully they use it so support our troops. I would be happy with that. Same as car tax, we do not get all this back into road investment.

I think they should put up stamp duty further and use it to support the building industry, BUILD MORE PRISONS AND LOCK MORE PEOPLE AWAY FOR LONGER!!

Justin_Nelson

Stamp Duty Land Tax (as it now is) is simply another tax, like income tax, inheritance tax, VAT, capital gains tax .... That's all there is to it, really

sunshinetours

Whatever wrote: »

One thing I'd really like an answer to from any party is "What is stamp duty for". Council tax we pay because I accept certain public services need to be paid for, but I'd love to hear how any politician can justify the reason for us paying stamp duty. We don't get anything for it. It's simply a case of "So you've work hard to be able to consider purchasing a home have you?, in that case we'd like some of your money for no reason whatsoever, other than because we want to rob you, because we are the Government and therefore we can".

What happens to the Stamp Duty we pay? Please explain how the public benefit from our Stamp Duty payments?

Can't believe nobody has asked the Government to explain this.

The government have to prepare and (in theory) balance a budget each year. Taxes from the citizens represent a large chunk of the monies coming into that budget. This then gets balanced against all the payments going out - education, welfare benefits, interest on borrowings etc etc

To take one tax in isolation doesn't really work. It's there because it has been there for a long while. And since properties have risen significantly in value over the past decade or two it now earns the government significantly more than it used to

However if you scrapped that tax other taxes would arguably need to rise to pay for it

The perhaps more relevant question really is should certain people perhaps not have to pay it ie first time buyers as is now the case

pingu2209

There was once a tax on how many windows you had in your house - go figure?!

theGrinch

pingu2209 wrote: »

There was once a tax on how many windows you had in your house - go figure?!

and you can still see windows bricked up from 200 years ago.

00ec25

in the past it went to fund the Land Registry itself, now it is just part of the general tax pot so accept the unfairness of it

SDLT is however a voluntary tax which you actively choose to pay if you buy a property. I have paid it once in my life.

it would be much fairer if there was only two taxes: income tax and CGT andall other taxes were abolished, then you will pay tax in accordance with what your ability to pay it and how successful are your investments (ie how "rich" you are)

Doozergirl

I'd rather pay SDLT at 1,3,4 or even 5% rather than 17.5% VAT like other purchases...

over_flo

What I think is crazy about stamp duty is the huge leap in what it costs if your house purchase happens to be in the next banding up.
(such as when we bought out house for 265.000)
We were liable for the whole amount at 3% .
It would be much fairer if the extra 15,000 over the 250000 threshold was 3% like with income tax.
Anyone with a house valued at this sort of figure is going to find it hard to sell and will be struggling to get any offers over 250K.

DVardysShadow

over_flo wrote: »

What I think is crazy about stamp duty is the huge leap in what it costs if your house purchase happens to be in the next banding up.
(such as when we bought out house for 265.000)
We were liable for the whole amount at 3% .
It would be much fairer if the extra 15,000 over the 250000 threshold was 3% like with income tax.
Anyone with a house valued at this sort of figure is going to find it hard to sell and will be struggling to get any offers over 250K.

I think you are absolutely right on this one. The way it is at the moment, the market gets very difficult around the discontinuities in SDLT - people don't want to buy just over the threshhold and sellers don't want to be knocked down below.

Fairly obviously, all that has happen with the current change to SDLT is that it has resulted in house prices going up - so the benefit has gone into sellers' pockets, giving no help to the first time buyer and a kick in the face for other buyers in the same market. If they just got rid of the discontinuities, then the market would work more smoothly, because first time buyers do depend on people moving higher up the market.

sunshinetours

over_flo wrote: »

What I think is crazy about stamp duty is the huge leap in what it costs if your house purchase happens to be in the next banding up.
(such as when we bought out house for 265.000)
We were liable for the whole amount at 3% .
It would be much fairer if the extra 15,000 over the 250000 threshold was 3% like with income tax.
Anyone with a house valued at this sort of figure is going to find it hard to sell and will be struggling to get any offers over 250K.

Totally agree with this also. It creates an artifical market around the various thresholds - especially the £250k- £270k market

We are considering downsizing in the current uncertain climate and to drop a bedroom means many of the houses are around that sort of level in our area and may actually mean the difference between doing or not doing it

I would keep the 1% and then up the next tier to say 5% on the amount over £250k and then 7.5% on the amount over £1m say or something along those lines