Sajid Javid has dismissed a report in the Times over the weekend that claimed he planned to make property sellers rather than buyers pay stamp duty tax.
“I wouldn't support that,” the chancellor said in a tweet.
“I know from the Ministry of Housing, Communities and Local Government that we need bold measures on housing - but this isn’t one of them,” he added.
Javid had appeared to suggest the idea in an interview with the Times, as he prepares for his first spending review.
When asked about changing who pays stamp duty to save first-time buyers paying any tax, he said: “I’m looking at various options. I’m a low-tax guy. I want to see simpler taxes.”
But the idea prompted some warnings that it could hit older people who are planning to downsize to smaller properties, which could prove unpopular with Tory voters.
It is also worth pointing out that many buy-to-let landlords offloading properties would have been adversely affected by this change.
There was an average of four landlords per letting agency branch exiting the market in June, according to the latest data from ARLA Propertymark.
With more landlords selling up, the number of properties available to rent continues to fall restricting supply for prospective renters.
David Cox, ARLA Propertymark chief executive, said: “The repercussions of the Tenant Fees Act, the proposed abolition of Section 21, coupled with the Mayor of London’s recent call for rent controls, will only cause the sector to shrink further.”
Following Sajid Javid’s denial of reported plans to shift stamp duty to sellers, Nick Sanderson, CEO of Audley Group, hopes that the chancellor is “speaking the truth” when he says he will not shift stamp duty to sellers, “for the sake of both the economy and the environment”.
He said: “Shifting stamp duty to sellers would be a catastrophic error. The potential positive impact on first-time buyers would be completely wiped out by the lack of available housing stock.
“Piling more financial burden on the seller would create a barrier to movement in the market, and exacerbate the UK’s existing under-occupation problem. It would be a major brake on downsizing which is so critical to increasing transaction levels.”
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