Stamp Duty - what does it pay for?

[SurreyGuy]

Why are house buyers charged Stamp Duty? In my (probable) ignorance, it seems that I am being charged 1% of the purchase price purely for the privilege of buying the property!

Does it go to the Government?

[Ethel]

It is a tax, pure and simple.

A way for the government to raise money. Don't blame the present government though - it was introduced in the K in 1694 under the reign of William and Mary to raise money to pay for the war against France.

[SurreyGuy]

Cheers Ethel.

As a voter, I WILL blame the current Government...............for failing to stop charging it! :o)

[buildersmate]

Its yet another stealth tax. Gordon's had plenty of opportunity to reduce it in the Budget as property prices have risen, but has he done so? Has he heck. So the tax-take by IR on it is absolutely huge now.

[Ethel]

As I understand it he did raise the limit that stamp duty is payable.

Am I wrong? No stamp duty if property is under �125,000.

[ugly_bob]

you're right there Ethel, but nowhere near in line with house prices rises.
For example, 30years �15,000 was the lower limit (I think), whereas that house now would be worth nearly �300,000 - Which attracts 3%
And of the total price too

eg A house costing �249,999 would have �2,499 stamp
a house costing �250,000 (mininum for 3%) would have �7,500 stamp payable!!

[buildersmate]

Alright Ethel, you are right. He did raise it a tiddly bit. But that's no use at all in the South where an average house is well over �250k now.

[oldhenry]

The same with Inheritance Tax, another windfall for G Brown to waste, the crazy housing situation in Britain allows the Government to have billions more to spend, but we do not all see the benefit .