In a report released this week, a cross‑party committee of MPs called for the complete abolition of stamp duty land tax, arguing that the levy is choking home‑buyer affordability and slowing the broader economy. Chaired by Labour MP Florence Eshalomi, the committee proposes a public consultation before year‑end to explore revenue‑neutral alternatives or rate cuts, and to align tax bands with local house‑price variations.

£12,500 Stamp Duty on a £450,000 Home Highlights Cost Burden

For a typical mover purchasing a £450,000 property, the current system would levy £12,500 in stamp duty, according to the committee’s calculations. The tax is progressive, with 2% on the slice between £125,001 and £250,000 and 5% up to £925,000, climbing to 10% thereafter. This sizable upfront cost, the report says, discourages transactions and pushes many first‑time buyers beyond reach.

First‑Time Buyer Threshold at £300,000 Still Too Low, Says Eshalomi

Labour MP Florence Eshalomi highlighted that the existing £300,000 threshold for first‑time buyers does not reflect today’s market, especially in high‑price regions.. she warned that without a fundamental redesign,home‑ownership rates will continue to slide, leaving those without family support with an increasingly unattainable dream.

Buy‑to‑Let and Overseas Surcharges Now Total 7% on £1 Million London Home

The report notes that buy‑to‑let investors and second‑home owners face a surcharge that rose from 3% to 5% in October 2024, while overseas buyers add another 2%, creating a combined 7% levy. an international buyer of a £1 million London property would owe £113,750, a figure the committee says fuels market distortion and discourages foreign investment.

Consultation Timeline and Revenue‑Neutral Alternatives Proposed

According to the committee, the government should launch a consultation before the end of the calendar year to test options that either replace stamp duty with a neutral revenue stream or reduce existing rates.. The review must assess each option’s impact on market friction, progressiveness, and overall fairness,the report stresses.

Who Will Replace Stamp Duty? The Missing Treasury Blueprint

The committee’s recommendations leave a key question unanswered: what concrete replacement will HM Treasury offer if stamp duty is scrapped? The report calls for an integrated review with other property taxes, such as council tax, but does not outline a specific alternative, leaving policymakers to devise a viable fiscal substitute.