Bad news, renters: This tax change does not benefit you
If you're renting your home and feel the property ladder is but a dream, you might want to look away now…
The recently introduced additional stamp duty charge on second homes will ultimately wind up hurting renters, a pressure group has warned today.
The TaxPayers' Alliance is calling on the new chancellor to scrap the additional three per cent charge, which was introduced in April.
The think tank also slammed stamp duty more generally, calling it an unfair tax which prevented people from buying their own home, downsizing easily or moving closer to work. At the very least, the report said, the rate should be halved immediately.
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"For decades politicians have failed to tackle the root causes of the housing crisis: a chronic lack of supply," said Jonathan Isaby, chief executive of the TaxPayers' Alliance. "What's more, stamp duty is still punitively high and gimmicky tweaks to the tax system will ultimately end up penalising tenants and increasing rents.
"The new chancellor should now seize the opportunity to drastically simplify and reduce property taxes, while removing planning restrictions which prevent huge swathes of land from being built on for no good reason at all."
A Treasury spokesperson said: "We've reformed the stamp duty system to make it fairer and cheaper for 98 per cent of people who pay it."
If you are feeling a little dismayed by the TaxPayers' Alliance's analysis, take heart – you're likely not the only one. Figures released by the Office for National Statistics last week showed 19.6 per cent of households are now renting their home, almost double the 10.3 per cent who were renting in 2005.