Stamp duty: why don't we start a national protest!

[gabriel]

I just read that in recent years the Chancellor has taken around £7bn a year from home sales through stamp duty.

This is robbery! No wonder the Government sat on their hands as prices soared. With their thresholds unmoved, the coined it. Still, I've no doubt they spent the cash wisely. Oops, sorry, forgive my sarcasm!

Makes you wonder if we couldn't start stirring things up with a campaign to get the public and the media behind a call for overhauling this punitive and unfair tax on property purchase.

OTOH seeing as the Govt has taken so much of housebuyers cash for doing nothing, maybe they could put some of it to good use and come up with something to help people deal with the impending property crash.

[Jez]

There is facility on the no10 website to create an online petition. There might be an applicable one already. I'll have a look when I get a chance.

[Paul Carcone]

The trouble with getting rid of one tax is that the Government will find another way of taking it from us. The will either increase taxes in another area or, even worse, will cut services.

Sadly, contrary to popular belief, the Government is not a huge bottomless pit of cash - The National Health Service and the Welfare State take up a vast amount of fiscal resource and the remaing Governmental departments are left scrabbling about for what's left.

I'd rather pay a discretionary tax like Stamp Duty than one I can't avoid like an incrase in VAT or fuel duty.

[Tony]

There are mechanisms that can be used to avoid stamp duty liability, such as putting the property into a family trust. I won't pretend I know much about it, but I guess that when the property is transferred stamp duty is paid based on the market value. As market values are low - now would be a good time to do this. Assuming you have the funds available to pay the stamp duty.

Tony

[gabriel]

The thing that bugs me most of all is the way the government have creamed it at housebuyers' expense.

VAT and other taxes have not raked in extra billions for the Treasury on the back of poor fiscal management and complete disregard to market forces. The Chancellor must have been rubbing his hands with glee at the escalating property prices in the past 10 years or so. All that lovely cash coming in just because of the glitch that means you pay 1% stamp duty on a house that sells for £249,999.99 but 3% on on that costs 1p more. THAT is not discretionary. It's downright discriminatory!

[GlasgowGirl]

Stamp duty is a poor system and an unfair tax (just what exactly is it for, anyway?) Paul makes a sensible point that public services must be paid for and I'm not generally in favour of populist tax cuts for cuts' sake. However I do think the stamp duty system could be made much more transparent and fair. Having said that, from my personal perspective the current focus on stamp duty is a bit of a red herring. The problem is not that stamp duty is putting people off buying houses, the problem is that the credit crunch, inability to get a mortgage and fear of the future is putting people off buying houses. Changing stamp duty won't really help with any of that.

[Paul Carcone]

The bottom line is that the Gret British public will be taxed £Xbn per year in order to, hopefully spend £X-y bn per year. A cut in Stamp Duty will mean that the government will either have less to spend (on hospitals, education, defence, and other public goods) or it will have to incrase its fiscal revenue from somewhere else.

Whilst I am not a fan of paying tax, as an accountant, I do understand how fiscal finance works. Whislt Stamp Duty may be seen as a somewhat arbitary tax, it is one that you can avoid by not buying a house over the threshold or not moving house. Additionally, it's a tax that I'd expect to pay only three or four times in my entire life.

The tax that REALLY annoys me is the tax levied on fuel. This not only harms ordinary people trying to get about their daily life, but it also hurts British industry as a whole as it makes manufacturing and transport of British goods more expensive and thus decreases the country's overall competitiveness.

[red]

The stamp duty issue could be beneficial for 'kick' starting the market in my opinion. However, whether the government chooses do do this or not they do need to decide on this issue and come forward and announce their decision. There is little room for dithering in the present housing market. By not making their decision can ultimately make the market stall further with people holding off elling or buying thinking the stamp duty maybe cut.

[Paul Carcone]

I agree wholeheartedly with the comment above...There is no benefit to be gained from dithering and this will undoubtedly have a negative effect on the market.

Uncertainty is NEVER a positive indicator for any economy and why the current Government does not realise this is entirely beyond me!

[red]

The recent news via the dispatches programme further re-enforced my belief that management of the housing market needs to be well thought out and managed.

The programme showed how the banks were happy to allow 125% interest only mortgages and 10 times earnings borrowing. That is disgraceful in my opinion.

Unfortunately the market needs to go through a correction to a more stable sustainable level.