An economist from the Organisation for Economic Co-operation and Development (OECD) has suggested that the UK should abolish stamp duty in a bid to revive the flagging housing market. Asa Johanssen has said that removing the stamp duty would reduce the barriers which first time buyers in particular have getting into the market.
She was speaking at the Housing and the Economy: Policies for the Renovation launch this week. She felt that the stamp duty should be replaced with a yearly tax to be shared between the government and the council. This tax would be based on the value of the home.
David Newnes from LSL Property has criticised the suggestion and commented that an ongoing tax would have a negative impact on house prices. He points out that while those who are buying will save money, they will be forced into paying an extra tax in the long term.
However not everyone is against the proposal. Dennis Hall from Yellowtail Financial Planning has said that removing the stamp duty would benefit those who are entering the housing market, while those with more expensive houses would lose out.