While Rachel Reeves prices young buyers out, scrapping stamp duty could finally open the door to homeownership
When my wife and I were saving for our first house, putting money aside every month, we visited the mortgage broker perhaps expecting to sign the paperwork and move in.
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When I told him how much I had saved, he laughed and told me I had covered stamp duty, now it was time to save for a deposit.
Just one example - but one rooted in reality for many families just like mine. For millions of ordinary Britons, the shadow of Stamp Duty looms over that dream of buying a first home or moving into that next one.
That’s why Kemi’s pledge to abolish this tax on the purchase of primary residences has been welcomed by the general public .
You can also measure the success of a policy by the reaction of the other Parties; it’s put their noses out of joint. They can’t fathom that cutting taxes could be good for people and good for prosperity.
And Stamp Duty Land Tax is one of the most anti-growth taxes there is. It’s anti-ambition, anti-free-market and anti-family. It’s a huge part of the reason why we have such a gummed-up housing market.
But don’t take my word for it. In April when Labour scrapped the additional SDLT relief we had introduced, this led to only 81,000 transactions of residential properties in May, compared to 177,000 in March .
In reality this can manifest as families of four squeezed into one-bedroom flats and pensioners struggling to maintain many bedroomed houses and it harms mobility all the way down the ladder.
So, abolition of Stamp Duty is the first step on the road to repairing the housing market. Letting the current distribution of homes to naturally reach something close to equilibrium.
I call this ‘rightsizing’. It will give certain pensioners the opportunity to move closer to their grandchildren in a house they can manage.
Right now, so much of their wealth is tied up in their home, the thought of passing £7,000 straight to a government who took away their winter fuel payments just isn’t attractive.
It’s not a silver bullet but, as I said in the Commons, what separates our plan from Labour’s is that it’s holistic.
If we end mass migration, easing demand, and inject some life into the housing market by cutting SDLT things can and will get better. Combine this with the ambitious planning reforms I hope to see coming down the track and you can really make a difference.
Labour on the other hand have talked up their planning reforms all whilst being 46% short of their 1.5 million target, chasing off landlords with their Renter’s Rights Bill and overseeing record low housebuilding in the capital.
Some critics have said that cutting stamp duty would be dangerously inflationary. With this thinking you’d never be able to cut a tax again. Is it any wonder that we have the highest tax burden in 70 years?
We need to kick the idea that taxation on almost everything is a natural state and that we are generously gifted tax breaks by a benevolent Government.
I accept that the main criticism of this policy will be cost, but Labour can’t fathom the myriad gains that encouraging transactions would bring about: through removals, decorators, window cleaners, gardeners, plumbers and electricians.
These are real people with real jobs funding the Treasury through VAT and income tax receipts. The increase in productivity means this policy could well pay for itself in the long term.
The alternative is Labour’s levy on life: taxed on your education, taxed when you work, taxed when you buy a house, taxed when you die. I want to see that changed.
As a policy, abolishing Stamp Duty, aligns directly with our Party’s principles: it rewards ambition, it unlocks the markets, and it lowers the tax burden on families. Not to mention that housebuilding and homeownership are in our party’s DNA.
It’s a moral mission to support young aspirant people through these important gateways of life: buying your own home, starting a family these are the building blocks of community.
Scrapping Stamp Duty is the first step on that mission and that’s why it would be the first tax cut made by a future Conservative Government.
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Jack Rankin is the Conservative MP for Windsor
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