MPs appear to support extending the stamp duty holiday

Some estate agents who wrote to their MPs lobbying for support to extend the stamp duty holiday have received responses, many of which a standardised reply that appears to show support for extending the tax break.

Estate agents, surveyors and solicitors are being encouraged to continue pleading with the government to extend the existing stamp duty holiday by a further six months, as buyers rush to beat the 31 March deadline.

The Guild of Property Professionals, along with other industry bodies, has been lobbying the government to extend the stamp duty holiday on behalf of both consumers and the property sector.

A letter has already been sent to the government with the backing of several industries bodies and major players in the industry citing the reasons why the extension would benefit the industry, the economy and most importantly people in the process of purchasing a property.

The Guild has provided agents – not just its members – with another letter that they have each addressed to their local MPs in an effort to increase pressure on the government to extend the tax break.

Below is the ‘standard’ response from each MP:

“I welcome the temporary cut to Stamp Duty Land Tax for home buyers across England and Northern Ireland until the end of the financial year.

“The Temporary Stamp Duty Land Tax (SDLT) cut will temporarily increase the Nil Rate Band of Residential SDLT, in England and Northern Ireland, from £125,000 to £500,000. This applies from 8 July 2020 until 31 March 2021 and cut the tax due for everyone who would have paid SDLT. According to the Treasury’s Plan for Jobs, nearly nine out of ten people getting on or moving up the property ladder will pay no SDLT at all as a result of this change.

“I welcome this measure as a crucial intervention to ensure medium-term confidence in the property market and maintain the growing momentum since the easing of lockdown.

“I am confident that this action to support the housing market is protecting and creating jobs. In England and Wales, an estimated 240,000 people are directly employed by housebuilders and their contractors, and between 500,000 and 700,000 employees are indirectly supported in the supply chain. Moving to a new house also boosts the economy, with estimates suggesting that doing so drives additional spending worth about 5 per cent of the house value.

There is strong evidence to suggest that the temporary cut to SDLT is having the desired effect, with a 14.5 per cent rise in residential property transactions in July, followed by a 15.6 per cent rise in August. This is in addition to the 30 per cent increase in construction activity in July.

I understand concerns regarding the backlog of transactions and the impact this could have on people whose purchases may complete after 31 March and I will alert my ministerial colleagues to the strength of feeling on this matter.”

Iain McKenzie

Iain McKenzie, CEO of The Guild of Property Professionals, says that he is “encouraged” that agents are receiving replies from MPs to their letters, but is also aware that at this stage “the government has not agreed to extend the tax break and have not laid out any plans with to regard to a phased out approach”.

He commented: “For the time being, the deadline remains, and many transactions will not make the cut off. We will continue to encourage our members and the industry collectively to have their say and send their letters to their local MPs.”

McKenzie added: “An extension of the stamp duty holiday would be optimal, however, if the government decides against an extension, at the very least a phasing out period would help lessen the blow to people currently in the process of buying a home.”

The letter to local MPs is available here.

 

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2 Comments

  1. AlwaysAnAgent

    The real problem? Too many trade bodies all shouting with muted voices and none of them representing all agents on a not for profit basis. One single voice would be loud, clear and listened to by decision makers but it can’t be one of the existing outfits as they are not taken seriously and are simply looking to make a few quid.
    Sunak has been smart with avoiding cliff edges but he also seems to wait until the last minute before doing a u-turn to smooth out a cliff edge. Whether the tax holiday is extended will very much depend on whether the economy needs a further injection of confidence in March.

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    1. StephenH

      And a second deadline is what we need to avoid. Conveyancers and other stakeholders are currently run ragged, and if a decision for another deadline is delayed it will mean that they will be run ragged twice.

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