Renewed calls for Stamp Duty reform that would see sellers pay tax

 
Renewed calls for Stamp Duty reform that would see sellers pay [Photo: designer491 via iStock]

Calls for Stamp Duty to be changed in a way that would greatly assist first-time buyers have been renewed ahead of the government's upcoming Autumn Budget speech. 

Some have called for ministers to scrap the property tax altogether in order to encourage more people to buy homes, but the Association of Accounting Technicians (AAT) said it would be a far better solution to simply have sellers, rather than buyers, pay Stamp Duty on homes. 

If this was done, the organisation said, then the £11 billion that is raised by the property tax every year would still be going into the public purse. However, it would ease the burden on particular on first-time buyers and encourage them to get onto the ladder when they might have previously seen it as being too expensive. 

"It’s widely accepted that stamp duty adds a burden to any home owners seeking to move, especially first-time buyers, because they must pay the tax as an immediate upfront cost together with finding a deposit and paying surveyors and solicitors fees and so on," said Phil Hall, AAT head of public affairs and public policy.

He added that the way the tax works at the moment "stunts mobility" and halts the building of more homes, which only makes house prices rise even higher. He said that the move towards owners, rather than buyers, paying Stamp Duty instead would be a "relatively simple way of solving these problems". 

The main problem that many newcomers to the market face is that Stamp Duty is usually an upfront fee costing them multiple thousands of pounds. And when this is coupled with a mortgage deposit and estate agent and solicitor fees, it's something that many cannot see themselves being able to afford.