WELSH STAMP DUTY REFORM EXPECTED TO HIT PRIME PROPERTY BUYERS THE HARDEST
According to the Financial Times, the Welsh Assembly is expected to introduce more stringent property taxation policies when power is devolved to Cardiff in 2018, though rates and bands will not be decided upon until the Assembly elections in 2016 have taken place.
The changes are likely to fall in line with Scotland’s recent adoption of a more progressive property taxation model, as well as last Autumn’s reform to English tax policies. Under the new scheme, Welsh property purchases at the middle to high ends of the market can expect to face higher penalties than ever before.
Mark Hayward, managing director of the NAEA (National Association of Estate Agents) voiced concerns that the changes could force Welsh families close to the English border to relocate, though he tempered his comments by acknowledging that the Welsh government is likely to be “very keen to set the level at a point where as few people pay it as possible”.
Hayward’s latter point will be a source of comfort to buyers at the lower ends of the housing market, but prospective property owners with bigger budgets may be in for a shock. Figures from the Office for Budget Responsibility suggest that though Welsh stamp duty revenue was relatively low in 2013-14, totalling £145 million (compared to the projected £8 billion in England and Wales combined), they expect these figures to rise to £231 million by 2018-19, the same year that it is expected that the Welsh government will implement the aforementioned reforms.
These policy changes will be the first tax policy changes implemented by Wales alone in over 800 years, and are intended to be fairer overall – determining stamp duty incrementally rather than with a fixed band “slab structure”, a model more akin to the typical designation of required income tax.
WEATHER THE WELSH STAMP DUTY STORM WITH FIDUCIA
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