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With a newborn baby and a 14-month-old son to support on an annual income of less than £20,000, police community support officer Laurence Ridge, 21, was hoping for better news in the budget.

“I think the decision to abolish stamp duty for first-time buyers is reasonable but he should have announced a bigger pay rise for public sector workers – the 1% we get is miniscule compared with inflation. Building 300,000 affordable homes is nothing, spread out across the country. Where are they all?”

Laurence has been the sole breadwinner for his family ever since his partner, Caitlin, 19, was made redundant last year. The couple rent a terraced house in Lancashire with their son, Lucius, and three-week-old daughter, Emmeline, and are entitled to child tax credit and child benefit. “We’re one of those ‘just about managing’ families the government keeps saying they want to help – but the chancellor is not fussed about us. If he did, he would have cut VAT, which hurts poorer people the most.”

Q&A

What is stamp duty?

Stamp duty is a tax charged by the government when you buy a property for more than £125,000. The amount you pay depends on the cost of your new home. 

The tax was first introduced in 1694 as a way to raise money for a war against France, and was eventually introduced on a wide range of purchases, including newspapers and perfume.

In 2003, the then chancellor Gordon Brown introduced stamp duty land tax (SDLT) to replace the old duty and homebuyers became legally responsible for declaring their purchase and paying the tax.

In recent years successive chancellors have used the tax as a lever to alter the course of the housing market. In 2008 and 2010 Alistair Darling launched stamp duty holidays aimed at encouraging sales; in 2012 George Osborne introduced higher rates for £2m-plus properties bought by overseas companies; and in 2016 he added a surcharge on second homes in a bid to calm the buy-to-let market.

The biggest change came in December 2014 when Osborne overhauled the way stamp duty was calculated. Prior to that, the whole value of a purchase was taxed at the same rate, leading to property prices bunching underneath each threshold. Since then, it has been charged like income tax – you pay a higher rate only on the part of your purchase that falls over each threshold. Anyone buying a property costing up to £937,000 pays less than under the old rules.

Photograph: Matt Cardy/Getty Images Europe


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Source : https://www.theguardian.com/uk-news/2017/nov/22/forget-stamp-duty-we-need-pay-rise-people-respond-to-budget