Reeves considers replacing stamp duty with new property tax | Tax

Guardian, Treasury, a new tax on the sale of more than £ 500,000 houses, more than 500,000 stamp taxes and a step towards a radical revision of Council tax.

While Rachel Reeves prepared the ground for tax increases in this autumn budget, senior ministers assigned to the authorities to model the impact before they examined how a new “proportional” real estate tax could be applied and to the ministers informed about the proposals.

Authorities examine a potential national real estate tax that will replace stamp tax in the houses occupied by the owner at the beginning. In addition, after the national tax, they examine whether a local real estate tax can be replaced by the Council tax in the medium term in order to repair the battered local authority financing.

The final decision was not taken. While a national tax can be applied during this parliament, it is understood that the revision of the Council tax will last longer and at least require the Workers to win a second period.

Policy options have been accepted as part of a large study of work, which aims to touch a large cumulative increase in home prices in recent years and obtains the Council tax based on property values in the early 1990s.

If the plans are fruit, they can provide valuable political guarantee for Reeves as policies that will appeal to most of the deputies and members of the party in order to earn extra income without breaking the commitment of tax collection to working people.

There has been an increasing pressure on the chancellor to take into account the taxes based on deck, especially than Deputy Prime Minister Angela Rayner, and the additional tax on more expensive houses can be offered in this light.

National Tax will be paid by owners in houses with more than £ 500,000 when they sell their homes. The amount paid shall be determined by the value of the property in the proportion determined by the central government that will collect revenues directly through the HMRC. It does not change stamp tax in the second houses.

Flow stamp tax rates It varies depending on whether one is the buyer for the first time and whether it is upward banded depending on the value of the purchased and sold property.

It will take time to replace the stamp tax and a range of options are considered gradually in changes. The income collected with stamp tax in primary houses changes significantly from year to year depending on the housing market conditions. The last financial has collected £ 11.6 billion in the year, According to government figures. Over time, it is believed that the new national real estate tax will be a more reliable, consistent source of income and ultimately increase the same amount as stamp tax.

The detection will affect only one -fifth of property sales compared to the existing stamp tax levels paid by the recipient of a house. According to Nationwide, the average price of a house in England was £ 272,664 in July.

Resources, Partial findings of Treasury officials A 48 -page report From the Center-Right Thinktank, which was released in August last year.

The opening report proposes a bilateral approach of a national and local “proportional real estate tax on the property based on its value. It was written by Tim Leunig, who has been working as a government advisor for more than ten years and is closely interested in the design of the Furlogh plan during COVİD-19 PANDEM.

Leunig wrote: “These offers would make the house easier and cheaper to move the house for a better job or to be near the family.

The government showed some steps to adopt some steps towards the Council tax put forward in its report: “The first step would be to end the over -funding of various councils in the wealthy regions of London, especially Westminster, Wandsworth and Kensington and Chelsea.” This is similar to the approach revealed in a consultation on how to redistribute to poor councils this summer.

The idea of a new local annual property tax, which will replace the Council tax, was also proposed in a further way. This plan will result in the owners of a property worth tax rates ranging from £ 500,000, depending on the value of their homes, rather than residents. They would pay at least £ 800 a year, and the funds they produced would go to local councils that have been seriously expanding in recent years.

In 1993, Rayner has already increased the likelihood of increasing the reputation of funds to address regional inequalities, which he claimed to have worsened by the current Council tax system, which replaced the survey tax in 1993.

Treasury spokesman said: “As mentioned in the change plan, the best way to strengthen public finances is to enlarge the economy – our focus is our focus. Changes in tax and expenditure policy is not the only way to see the economy in our planning reforms, which are expected to enlarge the economy and reduce the borrowing of 3.4bn £.

“For employees, we are determined to keep taxes as low as possible, so in the budget of autumn, we have protected the salaries of the employees and hid our promise not to increase basic, higher or additional income tax, employee national insurance or VAT rates.”

On the right and left of the political spectrum, economists have greatly criticized the stamp tax and council tax.

In June, the government launched an advice on how to reform the allocation of funds collected with the Council Tax. Labor “he said”Fair Finance Review““ In the crisis, he aims to correct the “broken funding system in which we inherited”, which leaves local authorities throughout the country.

Strategy, poor in -city London councils, after the emergence of millions of pounds of reaction came across a reaction.

The Institute of Financial Research, which is an economic thought, said that despite the need for reform, the government’s proposed changes in the funding examination would resist the expectation of lack of deprivation and urban areas at the expense of richer and rural areas, and that the government’s basic fund reform proposals are not particularly redistributive to the Urban Urban fields of England ”.

While any tax -related tax could provoke strong criticisms from right -wing competitors, the ministers showed their desire to ignore such criticisms for adding VAT to private school fees and changes in the inheritance tax for some farms.

If the stamp tax is invoiced as a longer -term substitute, it may be useful considering that the current tax is not popular and is commonly seen as a block in the tool and real estate market.

The implementation of use of ownership taxes instead of the Council tax will be complex and almost inevitably requires a second period in the task, but there is an increasing assumption that the current system is old and uninhabitable for the local government financing between all the main parties.

For decades, the worker has committed the biggest concussion of the council structures in the UK for decades, but he does not want to supervise the local authority that declared an effective bankruptcy, especially since it will be managed by the party.

Guardian last week, the Treasury’s rise to the autumn budget of the Treasury in order to alleviate the pressure on the country’s finance, said he was looking for ways to collect more money than the inheritance tax.