Government says it ‘does not plan to extend’ stamp duty holiday

Original Source: https://propertyindustryeye.com/government-says-it-does-not-plan-to-extend-stamp-duty-holiday/

Author: MARC DA SILVA

The government has confirmed that it “does not plan” to extend the temporary relief offered to property buyers via the stamp duty holiday.

Rishi Sunak

Estate agents, surveyors and solicitors were among those hoping that the chancellor Rishi Sunak would extend the deadline beyond 31 March to help stimulate the housing market next year.

But the Treasury has opted not to extend the stamp duty holiday for property buyers beyond March next year, and it is now feared that this could result in the collapse of almost a quarter of a million property sales, as buyers struggle to beat the deadline, owed in part to delays in the conveyancing process.

More than 23,000 people have signed a petition calling for the stamp duty holiday to be extended for six months after 31 March 2021.

As it received over 10,000 signatures, the government was required to respond.

A spokesperson for HM Treasury said: “The SDLT holiday was designed to be a temporary relief to stimulate market activity and support jobs that rely on the property market. The government does not plan to extend this temporary relief.

“The COVID-19 pandemic and subsequent lockdown caused uncertainty for those buying and selling residential property and property transactions fell by as much as 50% during the first national lockdown.

“To stimulate immediate momentum in the property market and to support the jobs of people whose employment relied on custom from the property industry, the Government decided to introduce a temporary Stamp Duty Land Tax (SDLT) relief. This relief increased the starting threshold of residential SDLT from £125,000 to £500,000 from the 8 July 2020 until 31 March 2021.

“Since the relief was introduced, transactions have increased and seasonally adjusted data shows that in October 2020, transactions were 8% higher than October 2019.

“As the relief was to provide an immediate stimulus to the property market, the Government does not plan to extend this relief. SDLT is an important source of government revenue, raising several billion pounds each year to help pay for the essential services the Government provides.

“The Government is committed to supporting home ownership and helping people get on and move up the housing ladder. When the SDLT Holiday ends, the Government will maintain a SDLT relief for first time buyers which increases the starting threshold of residential SDLT to £300,000 for first-time buyers that purchase a property below £500,000. In addition, a new Help to Buy scheme will be introduced from 1 April 2021. This scheme will run until March 2023.

“All tax policy is kept under review and the Government considers the views it receives carefully as part of that process.”

At 100,000 signatures, the petition to extend the stamp duty holiday will be considered for debate in Parliament.

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