Stamp duty hits homebuyers hard: Report |
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Thu, 07 Sep 2006 09:30
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LONDON - There was no respite to homebuyers in Britain, as they had to pay an average of £3,735 in stamp duty in spite of the government increasing the minimum amount applicable for tax.
The revenue generated from stamp duty in the three months from June has increased by 30 percent more to £1 billion compared to £773.9 million the quarter before. The government had increased the minimum amount applicable for tax to £125,000 from £120,000 in March. However rising property prices and the number of houses sold during the period saw the increase in the stamp duty revenue.
The research conducted by Portman Building Society using the Land Registry statistics showed that the average tax paid by homebuyers increased by 6 percent from £3,537 in the first quarter to £3,735 in the second.
"During the same period, average house prices went up by less than 4pc but there was a 23pc increase in the number of properties sold, which, according to Land Registry figures, caused the take from stamp duty to jump by 30pc", a spokesman for Portman said adding, "The Chancellor talked about helping homebuyers in the Budget by lifting the threshold for this tax but far fewer properties are changing hands below that level now. Only about a quarter of sales across Britain are below the stamp duty starting point and the proportion falls to 10pc in London."
The average price of a residential property in London is more than £250,000, the point where the stamp duty increases to 3 percent while properties exceeding £500,000 are subjected to a stamp duty of 4 percent.
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