Stamp Duty showing signs of slowing while stealth taxes continue to bite

Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown, comments on the publication of HMRC tax and national insurance receipt data, showing stamp Duty showing signs of slowing while stealth taxes continue to bite.

Key points from publication:
    • Stamp Duty receipts are £14 billion, £2.2 billion higher than the same period a year earlier.
    • Receipts from Income Tax and National Insurance contributions are £251.4 billion, which is £31.8 billion higher.
    • Inheritance Tax receipts were £0.6 billion higher than in the same period last year.
    • Air Passenger Duty receipts rose to £2.2 billion, which is £1.7 billion higher than in the same period a year earlier.
    • Figures run from April 2022 to November 2022.
Helen Morrissey says:

“After years of flying high we are seeing signs of the air starting to be squeezed out of the housing market – Stamp Duty receipts are higher than this time last year, but the trend is starting to come down.

“The figures run to November but will likely largely relate to transactions agreed a few months earlier before the chaos of the mini-budget sent would-be buyers running for cover. However, they still reflect the growing nervousness around affordability as the cost of living continued to bite and the market started to slow. 

“December often sees something of a Stamp Duty boost as buyers rush to be in their new homes for the festive season but given market sentiment is near all-time lows, we are unlikely to see the significant boost we saw last year and rising bills and the prospect of a recession on the horizon are likely to make buyers more hesitant to take the plunge over the coming months.

“Income Tax and National Insurance receipts continue to rise reflecting high employment but also the freezing of the Income Tax thresholds meaning more people are paying more tax. With freezes remaining in place until 2028 we will see this burden continue to rise.

“It’s the same case for Inheritance Tax thresholds which were also frozen in the Autumn Statement. The data says a small number of large transactions pushed up receipts, but the fact remains inheritance tax is becoming a headache for more and more people.”

 

Kindly shared by Hargreaves Lansdown

Main article photo courtesy of Pixabay