Stamp duty should be abolished as it’s ‘bunging up’ the housing market, says Shadow Chancellor Mel Stride

Shadow Chancellor Mel Stride doubled down on his claim: stamp duty It must be lifted to unlock a ‘stuck’ property market.

Home buyers have to pay stamp duty when they buy a property, and this tax can add thousands – or even tens of thousands – to moving costs.

A £500,000 house has a stamp duty bill of £15,000. That’s £30,000 on an £800,000 purchase.

In an upcoming episode of The Property Exchange podcast with estate agent Winkworth, Stride said the taxes that cause the most economic damage are ‘transaction taxes’.

‘Stamp duty slows down transactions and disrupts the housing market,’ Stride said.

He adds that stamp duty costs mean many young people cannot get on the housing ladder as easily as they should, in part because they are forced to take out a large lump sum to cover stamp duty.

First-time shoppers have an invoice discount on purchases up to £500,000, and under £300,000 are completely exempt.

“Economically, that means people are less likely to move from where they are to where the job is, so there is an impact on the labor market,” Stride added.

Stride said the stamp duty burden also meant households were less likely to downsize and free up supply in the market.

He said: ‘If you add all this up, you end up with a tax that does real economic damage.’

The Institute for Fiscal Studies has previously described stamp duty as ‘one of the most economically damaging taxes’.

The think tank said stamp duty in 2024 ‘clogging the housing market, keeping people who don’t need them in homes too big for them, thus reducing the supply available to growing families’; and serves to reduce labor mobility.’

The Conservatives have promised to abolish stamp duty on all primary homes.

“If you want to reduce taxes, stamp duty is one of the taxes you should start with,” he said on the Stride podcast.

Homebuyers and first-time homebuyers are affected by the stamp duty increase from 1 April 2025, as Labor has chosen not to extend the tax break that has been in place since 2022.

The amount of stamp duty transferred by first time buyers A study published last month found that tax rates have more than quadrupled since the end of the holiday.

Starter home buyers have paid around £408 million in stamp duty land tax since April 2025; this figure was just £101 million the previous year.

The Treasury collected more than half the stamp duty paid by first-time buyers from one locality alone, according to property portal Rightmove.

It analyzed the number of zero to two-bedroom properties sold in England to calculate the amount of stamp duty on starter homes charged by the Exchequer.

Stamp duty is paid by people who purchase property above a certain threshold.

The thresholds at which stamp duty will begin to be paid have not been permanently increased since it was first introduced in 2017.

However, buyers have been benefiting from lower tax bills since autumn 2022, when the threshold at which stamp duty must be paid was removed.

During the low-rate era, stamp duty was not payable on the first £250,000 of a property for most homeowners in England, but this has now been refunded on £125,000. There are varying rates for each portion of your property’s value.

But first-time buyers have a different fee. The threshold for them was reduced from £425,000 to £300,000 in April 2025. Everything above that is taxed at 5 percent.