Stamp duty holiday extension to be debated in Parliament
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Movers hoping for an extension to the stamp duty holiday could be in luck, as the topic of whether the tax break should continue beyond the March 31 deadline is now set to be debated in Parliament.
A parliamentary e-petition calling for a six-month extension has so far been signed by more than 100,000 people, meaning the topic will be addressed in the House of Commons.
The petition – which has 113,000 signatures so far – was started by a home buyer concerned that his purchase could fail to meet the deadline for the temporary reprieve, which was introduced by Chancellor Rishi Sunak in July to help boost the property market.
The official Treasury response on a proposed extension has previously been a firm ‘no’.
It said last month that the stamp duty holiday “was designed to be a temporary relief to stimulate market activity and support jobs that rely on the property market. The Government does not plan to extend this temporary relief.”
However, the fact that there have been two further lockdowns since the tax break was introduced, and COVID-19 sickness and homeschooling have put extra pressure on already stretched lenders and conveyancers, has helped build a case in favour of an extension.
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Research by Enness Global found that almost half (48 per cent) of current movers were worried that their sale wouldn’t complete in time because of delays during the selling process, and Rightmove said on Monday (January 18) that around 100,000 sales currently in motion are likely to miss out on the saving.
Tim Bannister, Rightmove’s director of property data, said: “There are still a huge number of sales agreed in 2020 that are stuck in the processing logjam and awaiting legal completion, with many hoping to beat the impending tax deadline.
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“For those who fail to do so, there may be difficulties if they have factored the tax savings into their budget calculations.”
Estate agents' industry body NAEA Propertymark is also calling for the cut to be extended.
Mark Hayward, Propertymark chief policy advisor, said: “The boom, caused by the property tax holiday, has been hugely beneficial for the housing market; however, the property tax cliff edge on 31 March 2021 could cause thousands of sales to fall at the final hurdle and have a knock-on and drastic effect on the housing market which has recovered well from the COVID slump.
"We have been calling on Government for some time to rethink the 31 March deadline, so pressure on the system can be released to allow transactions to complete and avoid a disorderly and distressing period for movers and businesses throughout the market."