The Labour party is proposing an overhaul to the Stamp Duty Land Tax (SDLT), with the details presented in an independent review that they have commissioned.
The report is entitled ‘Land for Money’ and it reviews property tax and land usage.
Overhauling SDLT is one of the key proposals, with the report calling for the abolishment of tax for people who are purchasing residential property as their primary residence.
The Government raised £13.6 billion from property transaction taxes for the year ending March 2018, with the figure expected to rise to more than £17 billion by 2023.
Stamp duty has been reformed in recent years, with a new form of calculating the tax being introduced, and tax breaks for first-time buyers, which has been extended.
The proposals in the report suggest that SDLT should be focussed on those who are purchasing second homes, as well as buy-to-let landlords with property portfolios.
The review is also calling for more transparency over land and property ownership in the UK.
The Government already has plans to introduce a register of beneficial ownership for non-UK based property owners from 2022, but the proposals in the report calls for a more in-depth register to be published as open data.
Capital gains tax (CGT) is being targeted for an overhaul, too. The review suggests that an increase on the rate of CGT on profits from residential property sales from the current rate of 20 per cent should be doubled to 40 per cent to reflect the rate of income tax.
The Resolution Foundation estimates that the CGT exemption for residential property cost the Government £28 billion in 2018.