SNP ministers refuse to follow Rishi Sunak by extending property sales tax holiday

Simon Johnson
·3-min read
The property sales tax holiday will be extended in England but not Scotland - Bloomberg
The property sales tax holiday will be extended in England but not Scotland - Bloomberg

Homebuyers in Scotland have been dealt a huge blow after SNP's Finance Secretary refused to follow the Chancellor in England by extending Scotland's property sales tax holiday.

Rishi Sunak announced in Wednesday's Budget the stamp duty holiday south of the Border, which had been due to end on March 31, would be extended for a further six months.

The current nil-rate band for purchases in England up to £500,000 will continue until the end of June, with a "tapered" period running until September.

Mr Sunak also handed the SNP government an additional £1.2 billion- more than double the £500 million that the Scottish Government had assumed that they would get when the draft Scottish Budget was published.

But Kate Forbes, the SNP's Finance Secretary, said yesterday the equivalent Land and Buildings Transaction Tax (LBTT) holiday in Scotland will still finish at the end of March.

She said there was no need to extend the holiday as it has "achieved its purpose", with "record" levels of home purchases being recorded despite the Covid pandemic.

To view this content, you'll need to update your privacy settings.
Please click here to do so.

However, Murdo Fraser, the Scottish Tories' Shadow Finance Secretary, said: "The SNP have decided not to give the same support to buyers in Scotland, despite receiving over £10 billion in additional pandemic funding from the UK Government.

"This is a mistake, and the SNP finance secretary needs to think again. The consequences of this will be that many families in Scotland will be unable to move home."

Nicola Barclay, chief executive of industry body Homes for Scotland, said: "It increases disparity with the rest of the UK and sends the wrong message to the home buying public at a time when we would expect government to use all the levers at its disposal to support consumer and business confidence.”

Anthony Conroy, estate agent Yopa's regional director for Scotland, expressed his disappointment, saying: "The cliff-edge date of March 31 will leave many sales vulnerable to fall-throughs and will leave lots of people disappointed." He added: "Support for the housing market has largely been forgotten about in Scotland, which will disappoint the buying and selling public as well as all those working in the property industry. Kate Forbes has missed a trick here."

To view this content, you'll need to update your privacy settings.
Please click here to do so.

The purchase price at which LBTT kicks in was raised from £145,000 to £250,000 last year, saving buyers in the affected bracket up to £2,100, but only until the end of this month.

Estate agents Rightmove estimated that about 300,000 transactions in England could benefit from Mr Sunak's stamp duty extension, with buyers potentially saving an additional £1.75 billion.

Economists at the University of Strathclyde's Fraser of Allander Institute said the Chancellor's spending on the extension south of the Border "will increase the resources available to the Scottish Government" in its block grant from Westminster.

But Ms Forbes said there were no plans to follow suit in Scotland, saying: "We will stick to that original plan, that was set out clearly. It was intended to support the recovery of the residential property market this financial year, that has been achieved."

She added: "Ultimately, when it comes to tax policy, I have choices. The number one ask from business was to extend the 100 per cent relief on non-domestic rates, that's what I have done alongside freezing council tax to help households in need so those are our choices in taxation."