Scotland Reacts to Stamp Duty Reforms
The Scottish National Party Government in Scotland is thought to announce new rates and bands for their Land and Buildings Transaction Tax (LBTT), after they were launched as an alternative to Stamp Duty three months ago.
The Scottish media have reported that the Scottish Government finance minister, John Swinney, will significantly review the original LBTT plans, which, when initially announced, would be hugely cheaper for most homebuyers than UK Stamp Duty thresholds at the time.
However, December saw UK chancellor George Osborne introduce a Stamp Duty reform. Stamp Duty was immediately lowered for 98% of buyers, with those paying over £937,000 the only ones facing a higher bill.
A newspaper in Scotland, The Herald, reported that the new lower Stamp Duty made the upcoming LBTT more expensive for many Scots.
The Herald claims: “Instead of 10% of people paying more with LBTT, the figure became 20%, while the threshold for paying more fell to £254,000, just above the average price of a detached home in Scotland. Since Osborne’s move, Swinney has faced mounting calls to U-turn on his LBTT rates.”1
It is expected that the new LBTT rates will be revealed to Members of the Scottish Parliament on Wednesday, before a vote on the 2015-16 Scottish budget.
As before, the changes are predicted to only mean the buyers of the most expensive 10% pay more with LBTT than Stamp Duty.