Stamp duty is set for its fourth rise in five years.
Chancellor Gordon Brown is expected to announce an increase at the top end of the tax, for properties worth more than £500,000, in his pre-Budget report on Wednesday.
Although the Chancellor is known to prefer an increase in public borrowing to putting up taxes, it is understood that the Treasury will use escalating house prices as a justification for a hike in stamp duty, seen by the Treasury as a “soft tax”.
The Chancellor is said to be considering an increase in the tax to help fill a potential gap in his spending plans, caused by a 20% drop in corporation tax receipts, the global economic slump and the prospect of war with Iraq.
But the Chancellor is under pressure from the RICS to raise the lower threshold at which stamp duty becomes payable, in line with house price inflation, from £60,000 to £120,000.
See Saturday’s Estates Gazette for the full version of this story.
EGi News 22/11/02
