A thinktank has urged the government to scrap stamp duty and council tax in London
The government has been urged to abolish stamp duty and council tax in order to tackle London's housing crisis. Thinktank Centre for London has published a report concluding that a levy on property wealth would free up homes, fund social housing and assist renters in saving for deposits.
The report revealed that average floor space per person increased by nearly 30 per cent between 2004 and 2023, however this additional space was disproportionately allocated to higher-income owner-occupiers, reports Birmingham Live. Households in the top 20 per cent of earners saw a 27 per cent rise in space owned, while the bottom 40 per cent experienced a rise of just 6 per cent.
"By every metric that matters, the housing crisis is at its worst," said Rob Anderson, the director of research at the Centre for London and co-author of the report. The report called on the government to scrap stamp duty and council tax, replacing them with a partly devolved annual proportional property tax that could fund 106,000 social and affordable homes over the next decade.
"It is widely acknowledged by economists and politicians from different parties that stamp duty has a disruptive effect on the housing market and both stamp duty and council tax act as an incentive to hold on to property," Anderson said "Removing stamp duty on ordinary movers would release an extra 79,000 homes a year, while raising funds for investment into social and affordable housing. " While "building more homes is a given", the situation is considerably more nuanced, according to the Centre for London.
"The problem cannot just be understood as a simple shortage in the number of homes," Anderson added. "London can build more homes and it must. But if housing policy only focuses on increasing headline supply numbers and beating delivery targets, we risk missing the real problem: a housing system which is not delivering enough homes overall. "
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