Scottish Government urged to follow Chancellor’s lead on stamp duty
Rishi Sunak announced buyers south of the border would no longer pay the levy on property sales worth up to £500,000.
The Scottish Government has been warned of “dire consequences” if SNP ministers fail to match Rishi Sunak’s cut on stamp duty south of the border.
The move was part of a series of announcements from the Chancellor which will see the Scottish Government get an additional £800 million in funding – taking the extra cash it has received from Westminster since the start of the coronavirus pandemic to £4.6 billion.
But Scottish Finance Secretary Kate Forbes complained the figures for Scotland from Mr Sunak’s summer update are “disappointing, underwhelming and fall short of the scale required to reboot the economy”.
The Scottish Government had been pressing hard for its borrowing powers to be increased, to help with the response to Covid-19.
Ms Forbes tweeted: “There is no reply to Scot Gov, Welsh Gov & NI Executive’s plea for fiscal flexibilities and no sign, as yet, of the level of funding we need.
“The UK Gov could have set out an ambitious plan of at least £80bn or 4% of GDP to reboot the economy and protect jobs.”
Her comments came after Mr Sunak unveiled a series of measures in what he branded a Plan for Jobs, aimed at boosting the economy in the wake of the coronavirus crisis.
As part of that the Chancellor announced house buyers in England will not pay duty on property sales worth up to £500,000.
The move is temporary and will only apply to the end of March next year – but Scottish Conservative leader Jackson Carlaw said its importance “could not be underestimated”.
He joined with the property industry in calling for the move to be matched in Scotland – with Mr Carlaw warning if the Scottish Government did not take a similar stance on its Land and Buildings Transaction Tax (LBTT) “the consequences for families and the wider economy will be dire”.
The call was echoed by Scottish Secretary Alister Jack, who said: “The stamp duty cut gives a helping hand to the housing market and building trades in England. I urge the devolved administration to use their powers to do the same in Scotland.”
Ms Forbes is due to give her response to the Chancellor’s statement to MSPs on Thursday.
But First Minister Nicola Sturgeon pledged: “Where there are decisions for us in some of the decisions he has announced, we will set that out quickly.”
The move on stamp duty was one of a series of measures announced by the Chancellor as part of an emergency package of support in the wake of Covid-19.
He slashed VAT on food, accommodation and attractions from 20% to 5%, a tax cut worth up to £4 billion.
And he promised bosses a £1,000 bonus for each employee they bring back from furlough and continuously employ through to January, as well as confirming details of the £2 billion “kickstart” scheme of taxpayer-funded work placements for 16 to 24-year-olds.
Mr Sunak said the Covid-19 crisis had “highlighted the special bond which holds our country together”.
He added: “Millions of people in Scotland, Wales and Northern Ireland have been protected by the UK Government’s economic interventions – and they will be supported by today’s Plan for Jobs.
“No nationalist can ignore the undeniable truth: this help has only been possible because we are a United Kingdom.”
Speaking about the stamp duty cut, Mr Carlaw said: “This change will not just increase the number of properties bought and sold after months of lockdown. It will provide a boost to all those trades who depend on people moving home, decorating, renovating and generally making choices which keep the wheels turning for small businesses.”
David Alexander, joint managing director of property management firm apropos, said the move would “provide an immediate boost in confidence for buyers”.
He added: “Scotland must follow suit if we are to face a level playing field and encourage homebuyers to continue to engage with the market during these difficult economic times.”
Meanwhile, the cut in VAT for food, accommodation and visitor attractions was welcomed by Marc Crothall, chief executive of the Scottish Tourism Alliance, as a “huge catalyst for the tourism economy”.
He added: “I know this news will come as a huge relief today for thousands of pubs, restaurants, accommodation providers and visitor attractions across Scotland.”
But Russell Gunson, director of the IPPR Scotland think tank, said: “It’s disappointing that the amount of money spent on reducing stamp duty in England is more than the increases in spending proposed to tackle youth unemployment.
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