First-time Buyers

RICS calls for abolition of stamp duty tiers

Adam Williams
Written By:
Adam Williams

The Royal Institute of Chartered Surveyors (RICS) has called on Chancellor George Osborne to remove the existing

It described the current tax system for house purchase as ‘archaic’ and said the government should introduce a tapered rate in the Budget later this month.

Under current rules a buyer purchasing a property for under £250,000 would pay 1% of the price in tax, while a home sold for £1 over the threshold would generate a tax bill of 3%.

RICS said there were currently a dearth of properties on the market priced between £250,000 and £275,000 as buyers and sellers seek to avoid the threshold.

It also called on the government to make changes to the Help to Buy scheme. RICS said adjusting the scheme on a regional basis would better serve the country’s needs and would create a more sustainable housing market going forward.

A consultation of RICS members found half would favour restricting the scheme to first-time buyers with garden cities also favoured as a method of boosting the supply of houses on the market.

It said the government should publish a prospectus to give potential investors clarity and certainty about its future house building plans.

Jeremy Blackburn, RICS head of UK policy, said: “This is a very important Budget for the Chancellor and one which will shape the economy in the run-up to the general election. A major area of concern in the property sector, at present, is the current stamp duty system which is both out-of-date and distorts the market by taxing buyers disproportionately high amounts should they go just one pound over the pre-set thresholds. A more intelligent, modern way of taxing property sales is needed for a market which is changing at a rate of knots.

“We would also like to see George Osborne provide more detail as to exactly what is meant by new garden cities and precisely how they would benefit communities and the economy. Taxing landlords who renovate their empty shops and offices is also on burden on the economy and discourages owners from taking their premises out of circulation to meet environmental standards.”