§ Baroness SHARPLESMy Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
§ The Question was as follows:
§ To ask Her Majesty's Government whether they will consider adjusting the rates of stamp duty on the transfer of property which were last altered five years ago.
§ The MINISTER of STATE, TREASURY (Lord Cockfield)My Lords, my right honourable and learned friend the Chancellor of the Exchequer has noted my noble friend's suggestion.
§ Baroness SHARPLESMy Lords, I thank my noble friend the Minister for that not entirely unexpected short reply. Will he perhaps ask his right honourable and learned friend whether he would consider raising the stamp duty on the much more expensive houses to compensate for the possible loss if the threshold of stamp duty on the lower-priced houses is raised?
§ Lord COCKFIELDMy Lords, I am most grateful to my noble friend for her interesting suggestion, which will certainly be examined. However, I see one immediate problem; namely, that the increase in the duty on the more expensive houses might need to be quite considerable to make good the loss of revenue on the smaller properties.
§ Lord GISBOROUGHMy Lords, is the noble Lord aware that this tax was 836 started in 1694, three years before the window tax, which was then abolished in the year of the Great Exhibition? Is it not time that this tax was thrown out of one of the long since unblocked windows?
§ Lord COCKFIELDMy Lords, I am most grateful to my noble friend for his excursion into history. The stamp duties are of course one of the oldest and most honourable of our taxes. Their origin lay in the greater ease of taxing a piece of paper, rather than taxing a somewhat elusive individual. The current yield of the stamp duties is of course quite considerable—namely, some £550 million—and my noble friend's suggestion therefore does raise certain difficulties.
§ Lord MONSONMy Lords, can the Minister say whether the Government have given any consideration to the idea of levying stamp duty not on the purchase of property, but upon its sale, as is done in certain other countries? This considerably helps first-time home buyers, while at the same time it largely maintains the revenue from this tax, which, as the noble Lord said, is considerable.
§ Lord COCKFIELDMy Lords, this is a suggestion which has been made on a number of occasions. The stamp duty itself is not charged either on the buyer or the seller; it is charged on the conveyance itself. It so happens that because the purchaser is the person who needs to have the deeds, de facto the burden tends to fall on the purchaser. But it is open to question whether if one tried to impose a tax on the vendor, it would not in fact be passed on in the price. However, this is an interesting suggestion, which we have looked at before, and which we shall certainly look at again.
Lord HAWKEMy Lords, have Her Majesty's Government ever considered putting an extra tax on the purchase by foreigners of property in this country? A tremendous amount of property is now changing hands and is being bought by Arabs, Dutch people and others.
§ Lord COCKFIELDMy Lords, while I am always grateful to receive suggestions, suggestions for the imposition of new taxes are not always particularly popular.