Scottish Government under pressure to replicate stamp duty cut

Finance Secretary Derek Mackay
Finance Secretary Derek Mackay

Scottish Finance Secretary Derek Mackay was under pressure last night to follow the UK Government’s decision to scrap stamp duty for first time property buyers.

The ending of the charge for people buying homes worth up to £300,000 was the most headline-grabbing announcement in Chancellor Philip Hammond’s Budget yesterday, but it does not apply in Scotland.

Scottish ministers have replaced it with the Land and Buildings Transaction Tax – which is free for homes worth under £145,000, applies a levy of 2% on property sales between £145,000 and £250,000, with this rising to 5% from £250,000 and £325,000.

Scottish Conservative leader Ruth Davidson said it would “make a massive difference” if Mr Mackay was to follow the chancellor’s lead in next month’s Holyrood budget.

However, others highlighted that average property prices were significantly lower north of the border.

The stamp duty measure was included as part of a package designed to “fix the broken housing market, and restore the dream of home ownership for a new generation”, but little of which applies north of the border.

Ryan Crighton, a director at national estate agent Aberdein Considine, said Mr Hammond’s stamp duty move had given his Scottish counterpart a headache ahead of the Scottish Budget next month.

“Derek Mackay already had an inbox full of concerns about the current structure of the Land and Buildings Transaction Tax, even before this announcement.

“However, the complaints he has been getting have been about the impact at the top end of the market, not first-time buyers, many of whom have actually benefited from the new regime in Scotland.

“That said, it will be hard for him to ignore the step taken by Philip Hammond today and what was looking like a reform of the tax at the top may now need to be a root and branch review.”