Welsh Government hold discussions over Land Transaction Tax ‘options’ in light of Stamp Duty changes in England

A decision on what, if any, changes to the Land Transaction Tax in Wales could be imminent with meetings taking place in Cardiff Bay this afternoon.

The First Minister Mark Drakeford today announced plans to “reopen the housing market fully” as part of the next phase of easing lockdown.

From 8 July to 31 March 2021 the special rules for first time buyers in England sees a zero rate up to property or lease premium or transfer value of £500,000 and for second homes the rate is 3% (full new rate info here). In Wales there is an existing zero rate to £180,000 however that scales up to include 7.5% int he £400k-£750k range (you can view the full current rate info here).

At today’s Welsh Government briefing we asked the first minister what he would be doing to stimulate that market in light of the Stamp Duty cut in England. We also asked if there was a consequential payment off the Chancellors’ announcement, and what if any, is the impact on the block grant?

Mr Drakeford said: “I’m meeting the Finance Minister Rebecca Evans this afternoon to discuss exactly this matter.

“We already had a far more generous system of land transaction tax in Wales than is the case of stamp duty land tax in England.

“You don’t pay LTT in Wales buying a house up to 185,000 pounds, and that covers a far greater proportion of sales in Wales than the regime in England previously covered.

“It’s not as simple I’m afraid, I wish it was, as a consequential. It is all a matter of how the block grant adjustment mechanism deals with taxes that we have control of in Wales, as compared to revenues raised through taxes, which are controlled solely for England. So it is quite complicated.

“It has taken a couple of days necessarily to get the full information but we will have that with us this afternoon, we will look at options. We will make a decision that we think is best for Wales and as soon as the decision is made, then we will make sure that we publicise it so that people will know if there are any changes to be made, what those changes are for house transactions and sales here in Wales.”

You can view the full briefing from lunchtime today below, along with the Q&A session:

Yn fyw gyda’r Prif Weinidog, Mark Drakeford | Live with First Minister, Mark Drakeford https://t.co/c8BoLxmDFz

— Welsh Government (@WelshGovernment) July 10, 2020