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Highlights

• Kirstie Allsopp tells MPs that stamp duty punishes buyers and should be abolished.
• 40 per cent of first-time buyers now face stamp duty, rising to 80 per cent in London.
• Treasury considering annual property tax on homes worth over £500,000 as alternative.

Tim Leunig, director of economics at Public First Consulting and former adviser to several ministers including Rishi Sunak, went further. He pointed that every single person in the country is a loser from stamp duty land tax because it restricts people from moving. The people who are the biggest losers are genuinely young people because they move more often.

However, Leunig cautioned that simply abolishing stamp duty would likely drive up house prices, particularly in London. Instead, he has proposed an annual property tax on homes worth above £500,000, with a 0.54 per cent yearly levy on home value and a higher rate for properties exceeding £1 m.

The Guardian revealed in August that the Treasury is considering a new tax on the sale of homes worth more than £500,000 as part of a radical overhaul of stamp duty and council tax.

The debate comes at a critical time for the housing market, with stamp duty currently levied on property purchases above £125,000.