John Swinney: 2014 launch for new house-buyer tax

THE fees house-buyers will pay under a new tax to replace stamp duty will not be revealed until September next year at the earliest, Finance Secretary John Swinney said.
Proposed tax to replace stamp duty will not be revealed until September next year. Picture: Jane BarlowProposed tax to replace stamp duty will not be revealed until September next year. Picture: Jane Barlow
Proposed tax to replace stamp duty will not be revealed until September next year. Picture: Jane Barlow

• Details of new house-buyer tax to replace stamp duty will not be unveiled until September 2014 at earliest

Scottish Government promises “more progressive system of taxation” than current set-up

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The Scottish Government said it would bring in a “more progressive system of taxation” than the current charge paid by property buyers.

Under stamp duty, a difference in property selling price of just £1 can lead to thousands of pounds in additional tax for the buyer.

The Land and Buildings Transaction Tax (Scotland) Bill will introduce “a proportional progressive structure” including a zero rate and at least two other bands.

A key part of the new system is only the proportion of the price above the threshold will be liable for the higher rate of tax.

Mr Swinney told MSPs it was a “system that will meet the needs of a modern, twenty-first century Scotland”.

The new tax will apply to property transactions from April 2015 onwards.

But the Finance Secretary said he would not set out the rates and tax bands for it until September 2014 at the earliest.

He told Holyrood he had still to reach a conclusion on when to announce these but he stated: “It is not my intention to announce rates and bands any earlier than September 2014.”

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However, he added he may “wait until nearer April 2015 to do so”.

Responsibility for the tax on land and property sales was devolved to Holyrood as part of the Scotland Act 2012.

Mr Swinney said the new system put forward by the SNP administration “signals a move away from the UK Government’s slab tax approach to stamp duty land tax which distorts the market”.

He stated: “Instead we are proposing a progressive system of taxation where the amount paid is more closely related to the value of the property, and therefore to the ability of the individual to pay.

“This approach has been warmly welcomed by tax professionals and others during the public consultation.”

Mr Swinney added that the Bill, together with legislation to introduce a Scottish landfill tax, was among the “first important steps to establishing the principle that taxes paid in Scotland are best set, managed and collected here by those with Scotland’s best interests at heart”.
SEE ALSO: Holyrood urged on details of stamp duty replacement