Halifax mortgages finds 900% increase in stamp duty

Stamp duty land tax is costing property buyers nine times more than it did ten years ago, Halifax has found.

The Treasury is expected to take over £4 billion in stamp duty this financial year, according to the Halifax, who claims that revenue from stamp duty has risen from £465 million in 1993-4.

A new survey by the mortgage lender shows that 81 per cent of people think the current stamp duty regime is unfair on first-time buyers.

Seventy per cent of those questioned said that the Government should increase the threshold at which stamp duty is payable in order to account for rising property prices.

Halifax says that in 1993, buyers paid an average of around £45,000 for their first homes, well below the stamp duty threshold of £60,000.

But the lender claims that the average price of a first home is now £131,000, with first-time buyers paying property prices above the threshold in 98 per cent of the towns surveyed.

Halifax claims that if the Government had increased the £60,000 threshold in line with house price inflation since 1993, it would stand at around £157,000 and thus prevent many first-time buyers having to pay stamp duty.

"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," said Halifax chief economist Martin Ellis.

"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," he added.