Data from HM Revenue & Customs (HMRC) confirmed that the number of property transactions in the year to 31 July 2017 was broadly the same as the previous year, yet Stamp Duty receipts rocketed by £2bn, from £10.4bn to £12.4bn.
Robert Pullen, director of accountant Blick Rothenberg – who analysed the figures – said that while some of this could relate to general property price increases, it was likely that the majority of the increase was down to the 3% surcharge on second homes.
Pulled added: “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 evidenced by the number of property transactions falling.
“The government will need to urgently consider whether the additional 3% Stamp Duty policy is helping achieve fairness in the property market, or if it is creating more problems than it is solving.”
Research earlier this month from the London School of Economics and the VATT Institute for Economic Research suggested that Stamp Duty is clogging up the housing market by dissuading older people from downsizing, restricting the number of homes available to first-time buyers.
The research claimed that if the tax was abolished completely the level of home moving would jump by 27%.