UK Treasury considers replacing stamp duty with a new levy on homes over GBP 500,000, aiming for more stable revenue from fewer transactions.
The UK Treasury is reportedly considering a major shift in property taxation, exploring the replacement of stamp duty with a new national levy targeting residential property sales exceeding GBP 500,000.
Under existing rules, stamp duty is paid by buyers and follows a tiered rate system, starting at 2% for properties priced between GBP125,001 and GBP 250,000 and reaching up to 12% for the portion of value above GBP 1.5 million.
In the 2023–24 fiscal year, stamp duty generated GBP 11.6 billion in revenue. However, receipts fluctuate with market conditions. As of August, average asking prices in the UK declined by 1.3%, settling at GBP 368,740, according to data from property platform Rightmove.
If implemented, the new levy would apply to about 20% of property transactions, compared with the 60% currently subject to stamp duty. It is expected to provide a more stable revenue stream, matching current stamp duty yields.
