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Friday February 26 2021

Stamp duty holiday has been extended to end of June 2021

Rishi Sunak, who has been Chancellor of the Exchequer since February 2020, has extended the stamp duty holiday by three months until the end of June 2021 to keep the property market active as Britain emerges from lockdown.

In July last year, the government exempted most buyers from the levy if they completed their purchase before March 31st 2021. The extended stamp duty holiday enables people to buy and to complete their sale by 30th June 2021 and save up to £15,000 in tax.

Rishi Sunak has been leading the Treasury's response to the financial consequences of the pandemic since his appointment. Other initiatives include the furlough scheme for job retention, relief from business rates and the Eat Out to Help Out scheme.

“The chancellor has faced pressure to extend the deadline amid concerns that it would create a “cliff-edge”, jeopardising hundreds of thousands of sales”- as The Times put it. The extended deadline of the tax break is expected to keep sales buoyant and maintain the upward trend in property prices.

Experts say that, although the extension will generate a £3.9 billion loss for the Treasury, it would recoup taxes worth about £4.1 billion from the boost to housing market activity. (See the results of the research of the Centre for Economics and Business Research here: https://esrc.ukri.org/news-events-and-publications/evidence-briefings/stamp-duty-impact-on-the-housing-market/ )

Those who are buying property usually refurbish or redecorate – keeping the property market moving means fewer people furloughed and more having jobs in the building industry in these difficult times. “Since the tax relief was introduced in July 2020, property sale transactions were 8 % higher than October 2019.”- wrote Charles Hymas in The Times.

The stamp duty holiday has been a positive political response and helped the economy during the critical times of the pandemic.

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