Kemi Badenoch, the leader of the Conservative Party, announced her intention to abolish stamp duty, branding it the “Chance to Buy,” today at a political event. She compared her proposal to Margaret Thatcher’s historic “Right to Buy” scheme, which allowed council tenants to purchase their homes at a discounted rate, reports BritPanorama.
This announcement coincides with the 100th anniversary of Thatcher’s birth, a moment that Badenoch leveraged to draw parallels between the two Conservative leaders. She described stamp duty as “one of the worst taxes” and a “trap” that prevents young individuals from moving out of their parents’ homes and forces pensioners to remain in houses that are too large for them.
By eliminating stamp duty, Badenoch claims that homebuyers could save £15,000 on properties valued at £500,000, reaching as much as £43,750 on properties worth £1 million. The proposed policy would exclusively apply to primary residences, excluding landlords and second-home buyers from benefits.
However, scrapping stamp duty would cost the UK’s Treasury £4.5 billion initially, escalating to £9 billion following the next election as house prices rise. Chancellor Rachel Reeves, facing significant budget deficits, is set to announce a series of tax increases next month to address a funding gap projected to reach £50 billion.
The Institute for Fiscal Studies has recommended doubling council tax on higher-value properties to generate £4.4 billion. Additionally, it has called for reforms to inheritance tax, aiming to eliminate the extra £175,000 allowance currently allowed for passing on a primary home tax-free, which could raise around £6 billion. The Institute has also cautioned against imposing an annual wealth tax on the populace.
Badenoch’s criticism of stamp duty underlines a broader concern regarding the accessibility of the housing market in the UK, as she outlines a vision for a new homes policy aimed at revitalizing homeownership.
