Burnahm Land Tax Replacing SDLT

[maureenponderosa]

https://www.standard.co.uk/news/politics/andy-burnham-tax-london-land-value-council-stamp-duty-b1286586.html

While I think this is overall a very sensible approach, and do think Stamp Duty is a tax that discourages market movement, I’m a bit worried about this.

We moved recently. Paid £30,000 in SDLT. It will be so galling to have to then pay a stamp duty replacement tax when we’ve already paid so much in stamp duty.

I wonder how this would be rolled out. Would it apply to all purchases after a certain date or to everyone whether they’ve already paid the tax or not.

Hoping it would be the former.

Any speculations?

Headline mentions London but we’re nowhere near. Very rural. No London salaries.

On that basis I don’t know what I would do. I can imagine there would end up with a lot of people continuing to live in sub optimal conditions because this kills off the ability to buy somewhere bigger on affordability grounds. Will hit young families. Then there are those who will just end up wracking up debt if they are even allowed to defer - if they decide you can afford it will you have to remortgage?

they are naive to think tenants won’t pay it in the end - I’m not sure they understand basic economics

Someone upthread said they're already paying around £4,000 a year in Council Tax in the North/North West. If I've understood the proposal correctly, does that mean their bill would initially rise to around £5,200 a year - and that is just for starters?

Forcing people out of their homes, or into debt, because of an unrealised paper valuation doesn't strike me as particularly fair

"Until we stop aiming for a house for each family our housing costs will continue to be a killer, we live on a island after all."

The main driver of "housing costs" was the cost and availability of mortgage debt, as mortgage debt gets more expensive house prices will come down, being on an Island isn"t really the issue.

https://internationalinvestment.biz/en/real-estate/5672-is-europe-facing-a-housing-bubble-ecb-warns-of-widespread-overvaluation.html

People were forced into unsustainable mortgage debt because of fantasy valuations so why not?

How do you suppose this is going to work for those of us who own a property and have already paid stamp duty?

I mean I guess logically a land value tax would only apply on a property you bought at a time after stamp duty was abolished.

He wouldn't try and impose a land value tax on people who have already paid stamp duty would he? That would be double tax!!!

But this is slippery Andy. I think we need to know!!

Farage is saying "They are taking your culture", very different meaning, until recently there were plenty of jobs, but you can"t have millions of young people pretending to be "anxious" and getting paid off the taxpayer teat while economic refugees do all the work, at some point you have to look out for the indigenous population?

It would have to apply to after the abolishment of SD, or they could do a refund scheme maybe? Who cares really, there will be a bond market meltdown soon after he is sworn in and he will be gone soon after, GE is the only way forward now

But if it’s replacing stamp duty and council tax then would they keep a second council tax going for decades? I suspect they will charge you the 0.48% and you get a rebate of say 0.1% until your stamp duty credit expires. So if you paid the higher percentages you’d end up being a lot worse off but hey, you have an expensive house so who cares right

or they only charge it on the uplift in MV since bought. But that wouldn’t bring much in

I suspect it will be like when they had the stamp duty holiday - if you bought just before and paid stamp duty you didn't get a refund.
If they're not worried about messing up the housing market (there will be more competition for houses at the lower end leading to price rises there and stagnation at the top end), eventual rent rises, and areas being "socially clensed", I can't see that a bit of double taxation would worry them.

No rebate @KateSixer

Thats already been confirmed as part of the proposed policy

’everyone who has paid Stamp already should be thankful they won’t have to pay again when they move ‘ or words to that effect

Oh thanks

but how does that work with the council tax element?

In reality a house that doesn"t drop it"s price based on the new tax liability isn"t going to sell, so unless everyone refused to drop their price there will be sales at all levels of the market as prices adjust to the new tax reality.

How do you mean ?

The Fairer proposal that Burnham favours is that

Stamp will go
Council tax will be reassessed as a LVT

I thought it was replacing both

so on that basis there’s no exemption for having paid a load of tax on the value of your home at purchase

well I look forward to seeing the consultation documents

So a basic flat in a cheaper area gets a CT reduction while more well to do leafy areas pay more CT?

Yes it’s replacing both

Yes that’s right, Burnhams clearly doesn’t care about those who have already paid

Fairers documents re recommendations and how it will work are already available
I’m not aware of any professional non biased independent scrutiny yet
Maybe the HofLs will have to do this

Right so his very first act is to steal from those of us who correctly paid stamp duty on our houses by taxing us twice.

Doesn't seem very fair does it!

It's positively Orwellian about how the word "fairness" is used by Andy...

He's a thief.

It will depend on the value of the property

that’s 0.48% irrespective of location
and 0.96% for second homes and foreign nationals

Ok, thanks.

Foreign nationals or non residents?

Removing stamp duty will short term significantly increase house prices unfortunately. But at least it is money you can get back when you sell, not just dead cash on stamp duty. We are looking to buy and worked out we would have to own the property for 22 years before the the fair value tax at 0.48% would start to cost us more than stamp duty

It’s not yet his first act
It hasn’t been confirmed
but he’s been talking about it for over 16years and has the support of many Labour MPs

His first act was to employ the ex chair of the Labour Friends of Israel as his Chief of Staff
that’s all he’s done so far as I’m aware

It is part of the inevitable shift to property being a tax target, this has been flagged for years, most people are attached to their property either by mortgage debt or they have to live in it as their primary residence so hard to avoid tax. This lot are just keeping the seats warm for Reform now though, I would look up their tax plans TBH.

.The 0.96% rate (double the standard 0.48% rate) applies to second-home owners, foreign buyers, empty homes, and properties owned by corporate entities.

google from Fairer

With interest rates increasing off the back of the Burnham Bond Crisis (BBC for short) it will balance out as house prices start crashing from the higher rates.