Sunak may cut stamp duty in autumn statement to woo voters
Rishi Sunak is reportedly mulling a cut to stamp duty in the autumn statement as part of a pre-election giveaway to voters.
The Treasury has worked up a proposal to raise the threshold at which housebuyers start paying the tax from £250,000 to £300,000, it has been reported.
“We don’t really have an offer on housing. Home ownership is key to driving economic growth and is at the heart of Conservative values. Stamp duty would send a signal to voters that we get it and we want to help,” a senior Tory told The Times.
It would mean nearly half of all people buying homes would pay no stamp duty, saving up to £2,500, and would cost the exchequer £3 billion a year by 2028-29.
With the Conservatives still trailing Labour in the polls, the Prime Minister is not expected to call a general election until late in the year, giving the Government the chance to fit in an autumn statement in which it could offer further sweeteners to voters.
In the last two fiscal events, Jeremy Hunt, the Chancellor, chose to cut the main rate of employer National Insurance contributions by two percentage points, on both occasions.
However, these National Insurance cuts appear to have done little for the Tories’ polling numbers, and the tax burden is still on track to hit its highest level since 1948 due to a decision by Mr Sunak when he was chancellor to freeze tax thresholds from April 2022.
With the Prime Minister setting out a “long-term ambition” to end the “double taxation” of work by eventually abolishing National Insurance, ministers hope that an autumn statement could marry a further cut to the tax together with a stamp reduction.
Currently, people start paying stamp duty at 5 per cent of the value of a property over £250,000, with the rate rising to 10 per cent beyond £925,000 and as much as 12 per cent for properties over £1.5 million.
If the stamp duty threshold was raised to £300,000, the biggest benefit would be for house buyers in the south of England where property prices are highest, but it would also mean that the average property in every region outside London, the southeast and the east of England would be beneath the threshold.
The Times reported that Mr Hunt had started talks this month with civil servants about the date of an autumn statement to make sure there is enough notice for the Office for Budget Responsibility, which produces an official forecast for major fiscal events.
In an interview with The Telegraph on Friday, Mr Sunak said that people would have to vote Conservative if they wanted a tax-cutting agenda.
The Prime Minister said: “If you’re someone who cares about cutting taxes, if you’re someone who cares about cutting the costs of net zero and if you’re someone who cares about stopping the boats, then why on Earth would you want to see Keir Starmer as prime minister?
“He doesn’t care about any of those issues. I do. Not only do I care about those issues and share your values on those issues, I’m actually doing something about all of them.”
He added: “Stick with this plan that is working, that is delivering change on the things that Telegraph readers and the country care about – cutting their taxes, controlling migration, cutting the cost of net zero, reforming the welfare system. That’s what we’re delivering. That’s the choice at the next election.”
