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The devolution of Stamp Duty Land Tax (SDLT)

wantspacegotspace.co.uk - The devolution of Stamp Duty Land Tax (SDLT)Chris Sutton of Jones Lang LaSalle, welcomed the announcement by the Prime Minister on the devolution of Stamp Duty Land Tax (SDLT) and commented:

“If properly reformed, SDLT presents Wales with an opportunity to make a real difference in terms of incentivising investment into the construction and development sector”. 

Chris commented that SDLT can be changed to provide:

1. Smoother Implementation – by changing the existing ‘slab’ structure of tax rates, where for example SDLT jumps from 1% to 3% at the £250,000 purchase level.  A solution could be a more progressive ‘slice’ regime where buyers crossing one of the SDLT thresholds pay stamp duty at the higher rate only on the price above the threshold.

2. Incentives to Achieve Policy Aspirations – potentially lower SDLT for brownfield land, disadvantaged communities, low carbon buildings, Business Improvement Districts (BIDs) and Enterprise Zones.

3. Incentives for Long Term Commitment by Employers – e.g. SDLT on leases could be reduced for long term leases, say over 10 years.

Chris Sutton added: “Stamp duty is, however, a wider issue than just the residential markets.  To attract long term funding from the institutional pension fund markets, then we must retain a more positive taxation system than the dominant English market.  If reformed correctly, there is the potential for a positive economic impact”.

“Whilst recognising that there may be concerns on precisely how these powers are put to use, in the case of Business Rates the track record has been positive.  Our Business Minister recently announced two powerful schemes to incentivise investment”. 

The ‘New Developments’ Business Rates Relief Scheme provides an 18 month exemption for new speculative development whilst the ‘Open for Business’ Scheme provides an incentive for businesses taking occupation of certain long term vacant retail premises.  Both schemes are a prime example of how business ideas can be taken up by the public sector.

Posted by The Editor (wantspacegotspace) on 4th November 2013

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