Rumours are circulating that the HM Treasury could be planning to increase stamp duty for buy to let landlords in the autumn budget.
The first suggestion of the plans came from an article authored by James Forsyth for The Sun. The article states that the move ‘would raise money for the exchequer and help to keep house prices down’ but ‘will do little to help people buy their first home.’
John Redwood, former trade secretary, told the Daily Telegraph: ‘There is no need to increase taxes and if you carry on increasing them you’ll collect less money.’
Keystone Property Finance chief executive David Whittaker spoke out about the rumours: ‘For a long time now landlords have propped up our broken housing market which successive governments have had neither the brains nor the courage to fix. A further hike in stamp duty aimed at the sector really would be the straw that broke the camel’s back and could result in landlords exiting the market in their droves. This would be disastrous for the country. It might peg house prices back a bit but it would hurt those in the rented sector more and could lead to an increase in homelessness.’
Connect for Intermediaries chief executive Liz Syms appeared unaware of the rumours. However, she commented: ‘I think it’s an easy political move to increase the exchequers purse, but not one that gives much thought to the wider consequences on the market. Buy to let has taken a hammering since new tax rules and the levy first came into play. However, for those professional landlords that have stayed in the market it is pretty much business as usual now. Extra costs are factored in and they understand that, as much as the government wants to cool the market, it is in fact vital for those unable to get onto the property ladder.
‘Nonetheless, if the levy is increased it could tip the balance for some landlords who, quite rightly, feel they are being badly harassed by the government. When house deposits are so difficult to raise rental properties are always needed. So perhaps, it’s time the housing crisis was tackled from a different angle, rather than penalising one particular sector of the market.’
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