The changes to the stamp duty bill mean anyone who wants to buy a house above the £2m threshold will now have to pay at least £140,000 in tax on the transaction. Previously, stamp duty on £1m-plus homes incurred a five per cent levy.
In his Budget speech, George Osborne made it clear that there would be no sidestepping of the stamp duty measures, warning: “I will not hesitate to move swiftly, without notice and retrospectively if inappropriate ways around these new rules are found.”
Property experts were quick to criticise the hike for hitting Londoners the hardest. According to Land Registry data, 73 per cent of £2m-plus sales in the past five years took place in the capital. Tax consultancy Kingston Smith said: “It would not be surprising if buyers of these homes seek to reduce the agreed price to cover the increase in the stamp duty payable.”
Savills confirmed this saying it will be guiding buyers to price below the £2m threshold.
The government predicts the move, which came into force today, will raise £150m in the next financial year, rising to £300m by 2016-17.