Banks slam lack of stamp duty change

A string of banks and building societies have vented their anger at the chancellor after he chose not to mention stamp duty in his pre-budget report.

14:30 03 December 2004

A string of banks and building societies have vented their anger at the chancellor after he chose not to mention stamp duty in his pre-budget report.

Campaigners had hoped that Gordon Brown would make a concession for people struggling to get onto the property ladder.

Stamp duty land tax is applied to properties worth more than 60,000. The lower limit to the tax has not changed since Labour came to power, while house prices have increased from an average of 76,103 in 1997 to 153,439 in November 2004, according to Nationwide.

The tax triples on houses worth more than 250,000 and increases again on properties worth more than 500,000.

Stamp duty is widely seen as a stumbling block for first-time buyers.

An ICM poll for the Woolwich published this week showed that the majority of homeowners would support a move to abolish stamp duty for first time buyers and an increase in the threshold.

Charcol, the UK's leading independent mortgage broker, said it was "disappointed, but not surprised" that stamp duty was not mentioned in Mr Brown's report.

Ray Boulger of Charcol commented: "[The Chancellor's] silence on reforming the current grossly unfair structure of stamp duty land tax is deafening.

"As expected the chancellor has yet again demonstrated his preference to perpetuate an unfair tax rather than undertake a well overdue reform."

David Bitner, head of product operations for Bradford & Bingley, commented: "The Chancellor has missed a crucial opportunity here to help beleaguered first-time buyers by not updating the stamp duty bands to reflect current market conditions.

"It was never designed to be a tax on first-time buyers, yet it now affects a vast proportion of them and is seriously hampering their ability to get a foothold on the property ladder. The average first time buyer now has to find over 900 to pay this tax, at a time when most are struggling to even fund a deposit."