Stamp duty has always been very controversial. Most people believe that it causes havoc in the market by distorting it at the thresholds.
Every year the Council of Mortgage Lenders calls for reform to what must surely be seen as a flawed tax, but to date their calls have fallen on deaf ears. The government seems determined to keep the tax and therefore the revenue it brings them. This is despite other voices joining the call for reform.
Mortgage intermediary garoup the AMI point out that with reduced amounts of house sales this would be an ideal time to make change to this law. Considering the economic situation the government is in though, they are highly unlikely to relinquish their hold on the revenue that stamp duty tax brings them.
One suggestion that has been made that would both encourage new buyers into the market and allow the government to maintain their grip on the tax money they are so desperate for, is to change who pays the tax. If stamp duty was payable by sellers instead of buyers it would be revenue neutral but still encourage new people into the market.
Clearly those people already in the market who paid when they purchased would have to be credited but this is a situation that would quickly right itself as turn over went on.
It is an interesting sounding and novel solution, though I am not sure how much hope there is of it being implemented.
