58% of homeowners and homebuyers believe Stamp Duty Land Tax (SDLT) is an outdated form of taxation in need of reform, according to new research by Butterfield Mortgages.
The mortgage lender commissioned an independent survey of 1,125 homeowners and homebuyers in England and Northern Ireland. It also found that 67% believe the government should come up with a fairer system to tax property transactions or home ownership.
The research revealed that SDLT is preventing 23% of respondents from getting onto or moving up the property ladder. 70% of homeowners and buyers in England and NI are in favour of overseas buyers paying a higher SDLT surcharge than the current 2%, while 66% think those buying second homes and investment properties should also have to pay a higher rate, which currently stands at 3%.
Butterfield Mortgages’ research showed a strong opposition among homeowners and homebuyers towards inheritance tax on real estate. 62% feel inheritance tax should be scrapped for properties that are passed down after someone’s death, given SDLT has already been paid.
The study also highlighted a desire for environmental considerations to factor into the current form of property taxation, with 36% of respondents keen for the introduction of a SDLT surcharge for properties that are less energy efficient.
Alpa Bhakta, CEO of Butterfield Mortgages, said: “The stamp duty holiday has placed property taxation firmly in the limelight, and our timely research shows there is significant demand among homeowners across England and NI to see a major overhaul of the tax.
“Primarily, the majority are hoping for a fairer alternative to be implemented, with greater surcharges targeted at overseas buyers and landlords. Given both groups are already subjected to surcharges but play a key role in driving property investment in the UK, the government will likely be mindful of not introducing much higher taxes for fear of harming the health of the property market or deterring too many prospective buyers, which would only reduce HMRC’s SDLT receipts.
“As the dust settles on the stamp duty holiday and the market re-adjusts to the new normal, it will be interesting to see how the tax evolves. Stamp duty is always somewhat controversial and therefore subject to continuous reform – we must wait to see what changes are in store next.”
