Tax receipts for stamp duty and annual tax enveloped dwellings fell by £700m to £1.2bn in April, compared to a year ago, data from HMRC shows.
The majority of this shortfall, over £500m, comes from lower stamp duty takings.
“This is driven by lower transactions in April 2023 but also by the lower rate of taxation and more generous relief for first-time buyers that were introduced in September 2022,” says the government tax body.
In former Chancellor Kwasi Kwarteng’s September tax-cutting mini-Budget, the zero percent stamp duty tax band was permanently raised to £250,000 from £125,000.
Also, the zero percent threshold for FTBs was raised to £425,000 from £300,000.
However, in current Chancellor Jeremy Hunt’s November Autumn Statement he said these reductions will only remain in place until March 2025.
Overall, HMRC says its receipts for April came in at £70.9bn, up £1.8bn on a year earlier, with the biggest contributions coming from income tax, capital gains and national insurance.
Coventry Building Society head of intermediary relationships Jonathan Stinton comments on the latest data: “Homebuyers are collectively spending less on Stamp Duty than they did last year – but that doesn’t mean they aren’t still being hit hard by the tax”.
He adds: “The new thresholds reduced the tax bill on an average priced home in England from £5,767 to £2,918, which is certainly an improvement but still almost double the £1,566 it was in 2014 when the previous thresholds were set. It shows the current thresholds simply aren’t doing enough to help homebuyers – and more concerningly for home movers, they’re still only temporary.”
Original Article
