It has emerged that 80 per cent of homes in England and Wales will have to pay stamp duty tax if they plan to buy after 2018, due to rising property prices, according to latest research by the TaxPayer's Alliance.
The research further revealed that if house prices continue to rise at the pace they currently are, 40 per cent of home buyers will have to pay at least £7,500 in stamp duty tax by five years' time. This equates to stamp duty of at least three per cent.
Currently, the Land Registry states that the average home in England and Wales costs £162,621. Even though this is under the three per cent stamp duty threshold, home prices are rising at such a rate that stamp duty tax may become a reality for many in the next few years. The situation is so bad in London that 99 per cent of homes will have to pay stamp duty by 2018, while regionally, the East Midlands and the north-west will see 70 per cent and 60 per cent of their homes fall under this bracket by 2018 respectively.
Matthew Sinclair, chief executive of the TaxPayers' Alliance, said: "As the property market recovers, more and more people will be sucked into paying punitive rates of stamp duty and it will be more expensive to move than ever.
"High stamp duty rates stop young people buying a home and starting a family, discourage elderly people from downsizing and make it harder to move to a new place for a new job. The government urgently needs to cut stamp duty and ease the burden before the situation gets even worse."
The TaxPayer's Alliance recently launched a campaign to try and cut this levy. Stamp Duty raised £4 billion for the Treasury in 2012.
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