Landlords and lettings agents have expressed disappointment at the Welsh government’s decision to press ahead with proposals for a 3% stamp duty surcharge on additional homes, including buy-to-let properties.
Following a consultation period, finance secretary Mark Drakeford has confirmed that the extra stamp duty charge will continue in Wales after it devolves the tax in April 2018.
Wales is following Scotland by replacing stamp duty with the Land and Buildings Transaction Tax – a decision that has incensed the Association of Residential Letting Agents (ARLA) and the Residential Landlords Association (RLA).
In a joint statement, ARLA’s David Cox and the NAEA’s Mark Hayward, commented: “We are disappointed that the Welsh government has decided to take this decision and followed the rest of the UK in implementing this punitive regime for buy-to-let landlords.
“We have been highly supportive of the new devolved tax regime in Wales precisely because it was a way that it could set its own tax agenda that works best for the housing sector in the region. In continuing with the surcharge, the Welsh government is not making the most of its new powers in order to increase the supply of homes that Wales so desperately needs.”
Cox and Hayward are agreed that the measures will lead to increased rent prices through a fall in supply and increasing demand.
“Tenants will also see additional costs passed onto them, as landlords look for ways to increase the profitability of their properties in the face of spiralling expenses. Ultimately, this will lead to sub-standard accommodation as money, previously used for the up keep of homes, will be swallowed up in tax payments.”