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Last Updated: Saturday, 29 January, 2005, 13:10 GMT
Stamp duty rockets as prices rise
House buyer browsing
House prices have risen relentlessly
Government income from residential stamp duty has risen nine-fold over the last 10 years, new figures show.

Spiralling house prices have seen revenue go from 465m in 1993-4 to 4.3bn in the current tax year.

The Halifax Bank of Scotland poll found 81% believed the current tax regime was unfair on new buyers.

Seven in 10 thought the threshold for stamp duty, which currently stands at 60,000, should be raised to reflect rising house prices.

The bank has worked out that the lower stamp duty threshold of 60,000 would now be 156,900 if it had risen in proportion with house prices.

Fair share

In 1993, the only significant numbers of first-time-buyers who were liable for stamp duty were in London and the south-east.

Stamp Duty for UK homes
Up to 60,000 - nil
60,001 to 250,000 - 1%
250,001 to 500,000 - 3%
More than 500,000 - 4%

The average house price paid by those new to the property ladder is above the 60,000 threshold in 98% of the towns surveyed.

The average paid by first-time-buyers is now 131,024.

Martin Ellis, chief economist at the Halifax, said: "Housing activity is an important part of the UK economy, and it is right that a government should take its fair share of tax revenue from it.

"Fairness is a two-way street, however, and unfortunately successive governments, irrespective of their political colouring, have failed to play fair by homeowners by declining to index link the stamp duty threshold to house price increases."

"According to the government's own estimates, it would cost the Exchequer around 600m to raise the lower stamp duty threshold in line with the rise in house prices since March 1993."




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Why most buyers must now pay stamp duty



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