Lord Truscott
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Finance Bill
Lord Truscott ExcerptsFriday 17th July 2020
(3 years, 9 months ago)
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Lord Truscott (Ind Lab) [V]
My Lords, I will refer to the Stamp Duty Land Tax (Temporary Relief) Bill. I declare my relevant interests as recorded in the register.
It is obvious that whoever designed this policy does not understand the housing market. The timing is wrong and the wrong groups are targeted. First-time buyers will not primarily be the ones to benefit from the stamp duty reduction, as many noble Lords have said; it will be investors and those with buy-to-let portfolios. Foreign investors will also see this as a window of opportunity to invest in the UK property market, both to benefit from the current stamp duty reduction and to invest ahead of the 2% rise in SDLT coming into effect in April 2021. First-time buyers will find themselves squeezed out of the market yet again.
As I mentioned, the timing is all wrong. It is too early to stimulate the housing market. As the furlough scheme comes to an end in October and the end of the Brexit transition period looms, a massive wall of unemployment will hit the country at the end of the year and early next year—that is a fair prediction. Mass unemployment always impacts on the housing market. With the end of the stamp duty holiday and the impending 2% additional SDLT rise for foreign investors in spring 2021, the housing market will most likely come crashing down by April 2021. That is when a stimulus really will be required.
Instead of the current policy, Her Majesty’s Government should exclude buy-to-let investors, second home owners and foreign buyers from the proposed stamp duty reduction. This would avoid temporarily overheating the housing market and primarily benefit those who really need help—first-time buyers—while giving a real boost to the housing market, which provides many jobs and so much revenue for the Government: £11.9 billion in 2018-19.