Stamp Duty Land Tax (SDLT) changes for landlords are raising twice as much revenue as first forecasted, new figures have revealed.
However, the report also shows that the changes have failed to dissuade second-home owners from buying up property.
The Government introduced a controversial three per cent SDLT surcharge – known as the “landlord tax” – on anyone buying a second home or buy-to-let property in April 2016.
It was forecast to bring in an additional £1 billion a year, but the latest data from HM Revenue & Customs (HMRC) shows that in the year to July 31, more than £2 billion was raised.
It brings the total tax take to £12.4 billion, compared to £10.4 billion two years previous.
The scheme was introduced to deter potential landlords and investors from purchasing properties, but the number of transactions has largely stayed the same.
Robert Pullen, Director at Blick Rothenberg, said: “The Government will need to urgently consider whether the additional three per cent stamp duty policy is helping achieve fairness in the property market, or if it is creating more problems than it is solving.
“The policy intention was always stated to be to realign the residential property market to make it fairer for first time buyers.
“It is becoming clearer, however, that as prices continue to rise the measure has succeeded only in generating extra tax for HMRC as well as a sluggish property market.”
The Treasury said it had raised its expectation of how much the change would raise by 76 per cent to £1.7 billion each year.
A Treasury spokesperson said: “We have cut stamp duty for 98 per cent of those who pay it when buying their main home, so that more people can achieve their dream of becoming home owners”
“The latest statistics show that transactions are rising. In fact, July saw the highest number of people buying or selling a home since March 2016.”
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