Sunak to pledge first-time buyer stamp duty cut
PAA pledge to permanently get rid of stamp duty tax for first-time buyers of properties costing up to £425,000 is expected to be included in the Conservative manifesto.
The tax is paid when someone buys a property in England and Northern Ireland.
What is known as the nil-rate threshold for First Time Buyers’ Relief up to £425,000 is currently due to expire at the end of March next year.
It comes with the party seeking to move on from the row about the prime minister’s decision to leave D-Day commemorations early on Thursday.
In a televised debate on Friday, Conservative Cabinet Minister Penny Mordaunt said the prime minister’s decision was “completely wrong”.
Their manifesto, which is expected to be published in the coming days, is not thought to include any pledge on inheritance tax.
However, Prime Minister Rishi Sunak will vow, that if re-elected on 4 July, he would scrap National Insurance, albeit when it is deemed affordable to do so – something Chancellor Jeremy Hunt has previously committed to.
Labour have frequently attacked the party for making the promise, calling it an “unfunded pledge”.
The Labour Party and the Liberal Democrats will also publish their manifestos next week.
The Scottish National Party’s prospectus is expected the week after.
Stamp duty is devolved to governments in Wales and Scotland, where it is called the Land Transaction Tax and the Land and Buildings Transaction Tax respectively.
The stamp duty tax cut for first-time buyers was first introduced in 2022 by Liz Truss during her brief spell as prime minister.
At the time, her Chancellor Kwasi Kwarteng said the change would remove 200,000 people from having to pay stamp duty.
Her government also raised the threshold at which other buyers had to start paying the tax from £125,000 to £250,000.
The rates are currently:
- 0%: £0 – £250,000 (£425,000 for first time buyers)
- 5%: £250,000 – £925,000
- 10%: £925,000 – £1,500,000
- 12%: £1,500,000+
There was also a stamp duty holiday during the Covid pandemic, aimed at helping home buyers whose finances had been affected.
The average house price in the UK stands at around £260,000
In 2021/22 stamp duty raised around £14.1bn, with residential properties making up three quarters of the total.
