Latest news with #LandandBuildingsTransactionTax
The National
9 hours ago
- Business
- The National
'Mansion tax' for £1 million Scottish homes rejected by MSPs
The Scottish Greens had tabled an amendment to the SNP Government's Housing Bill in order to bring in a new top tax rate for properties which sell for more than £1 million. Currently, Scotland levies a Land and Buildings Transaction Tax (LBTT) on residential property sales above £145,000. READ MORE: SNP reject Reform UK claims they 'organised protests against Nigel Farage' For homes between £145,001 and £250,000, a 2% rate is paid, which goes up to 5% for properties between £250,001 to £325,000, and 10% for sales worth £325,001 to £750,000. The current top rate of 12% is charged on properties sold for more than £750,000. The Greens' 'mansion tax' amendment would leave those bands unchanged but would create a new tax rate of 15% on residential sales worth more than £1m. The party tabled other amendments to the same bill, including an additional charge for overseas buyers of Scottish properties, plans which would enable councils to further increase council tax on holiday homes, and proposals which would make it easier for tenants to keep pets and service animals in their home. However, on Tuesday the proposal was rejected by SNP, Labour and Conservative members of Holyrood's Local Government and Housing Committee. MSP Ross Greer (above), who tabled the amendment, told The National that it was 'disappointing' that MSPs rejected the proposal and that 'only the very wealthiest people in the country, who can afford to pay more, would have been impacted' by the new tax. The MSP continued: 'Scotland has enough wealth to end injustices like child poverty tomorrow, but far too much of this money is in the hands of a tiny number of super-rich people and big corporations. READ MORE: Scottish MPs panned over up to £3500-a-month taxpayer-funded London homes 'Property taxes are important to ensure the wealthiest people pay their fair share back into our public services. I hope other MSPs remember that when they next complain about cuts to public services due to a lack of money.' The SNP's Housing Bill is currently at Stage 2, where MSPs are considering amendments. The deadline for the end of Stage 2 proceedings is on June 6, after which an updated version of the bill with approved amendments will be published. Scrutiny of the bill was split between Holyrood's Local Government, Housing and Planning and Social Justice and Social Security committees.
The National
3 days ago
- Business
- The National
Scotland's budget is a disaster – but it's not just the UK's fault
There are many things wrong with the current devolution settlement, and Scotland will do immeasurably better as an independent Scotland, but the mantra that Westminster dictates Holyrood's Budget is not borne out by the legislation. For some reason, which I can only put down to a fear of taking responsibility for our economy, the Scottish Government and its Cosla colleagues spend inordinate time and effort and administrative costs carving out revenue-raising initiatives, the sum total of which may raise at best marginal amounts, via double Council Tax on second homes, licensing short-term tenancies, tourist taxes and now a cruise levy, while cavorting with the UK Government as the junior partner in twisted green (free) ports and levelling-up programmes. Apart from introducing Land and Buildings Transaction Tax as a tartan tribute act to Westminster's Stamp Duty Land Tax, the Scottish Government has singularly failed to use the powers of devolved taxes in the Scotland Act which even its own senior civil servants agree can be done. READ MORE: Why the UK media 180 on Gaza is too little, too late The powers relate to transactions on the acquisition of an interest in land, and as a result give the Scottish Government almost total control over the use of land as a source of public revenue. With the exception of our people, land is our most valuable and flexible resource which can be used to raise public funds to replace the block grant; to tax the pipes and cables of the energy companies; to lift everyone out of poverty; to transform land ownership both in rural and urban Scotland, and provide the surest of foundations to build our enterprising economy. Instead, we over-concentrate in inward investment which can depart somewhat more quickly than the painstaking efforts and subsidies used to bring it here in the first place. Inward investment extracts value from our economy for the benefit of the home states of the investors. Scots are a nation of Haves. Our income may buy less than before in comparison with other nations, but within the UK, we have the highest salaries outwith London and the south-east. The social contract between our government and our people provides many benefits and rights not enjoyed by the other three nations and our poverty levels are significantly less than theirs also. If we are to maintain the Scottish Government's propaganda that we are in some form of straitjacket then that's meat to those Unionists who proclaim that we are better off in the UK and are subsidised by it, precisely because independent analysis shows we are better off than most nations and regions in the UK. If we are really serious about independence, we must reject the block grant and raise and collect all public revenue in Scotland – then the subsidy claim is buried once and for all. The powers which we have under devolution can transform all lives and end poverty. Using them to put money in everyone's pocket will set us with self-confidence on the highway to independence as the potholes of Unionism descend into a vortex of despair. Graeme McCormick Arden MY wife and I will shortly make our 32nd visit to the Greek island of Rhodes. We love the Greek people and their determination to be free of the oppression by the Turks for more than 300 years. We were severely disappointed at the 2014 referendum 'No' vote and more so when we had the embarrassment of being offered the condolences of sympathetic Greek friends after that result. Every Sunday when we are in Rhodes, we witness a military parade to the national monument in which the Greek flag is lowered and their national anthem is sung by the crowd of local people and visitors. The Greeks revere their national flag whose nine stripes represent the nine syllables of their motto, in Greek 'Eleftheria i Thanatos', meaning 'Freedom or Death'! (Image: Danny Lawson) The Greeks actually FOUGHT for their independence, as did India, Ireland and almost all of the so-called 'British Empire'. Every time we witness that parade in Rhodes, we feel thoroughly ashamed of our compatriots who couldn't even find the courage to put an X on a ballot paper. Scotland the Brave? The Scottish people should get up off their knees and establish, not claim, their sovereign independence. It should be remembered that the so-called Union was enabled by a 'Parcel of Rogues', as Rabbie said! Jim McKenna East Kilbride WELL done to Kelly Given on her powerful assessment on the Gaza situation and the very belated criticism of Israel from the UK Government (Doing the right thing now does nothing for the dead, May 22). David Lammy described Israel's continued action as a new dark phase in the conflict. That was the case many months ago, but they said nothing except making weak statements about more aid needing to get in. Nothing about the wanton death and destruction which the UK is helping to facilitate. War crimes are war crimes whoever is responsible. I suspect UK Government ministers are now getting a bit nervous that they might be complicit if a war crimes trial ever comes to fruition. The UN investigations are ongoing, and even if there were a ceasefire tomorrow, these indictments don't go away. The Benjamin Netanyahu government has been testing how far it can go breaking international law for the past 18 months and has found it can get away with just about anything, shielded as it is by the US, which of course doesn't recognise the ICC. We're doing our bit out of Akrotiri, providing surveillance, as you highlighted in The National, as well as possibly helping the transport of weapons from the US to Israel. The UK Government said it's suspending trade talks with Israel. I didn't know there were any. Why would you want to trade with a regime guilty of war crimes? We stopped trading with Russia as soon as it invaded Ukraine. UK exports to Israel are around £3 billion and imports slightly less at £2.5bn, a relatively minor trading partner. While it's currently illegal for institutions to boycott Israeli goods, consumers are free to make their own decisions. Fruit and vegetables is one area to keep an eye on, as the origin is sometimes deliberately concealed. Another consumer area is moulded plastic, and there's quite a lot of plastic garden furniture and storage stocked by DIY stores and garden centres which are made in Israel, but you have to look very carefully to find the origin in the small print. When will justice be done? Hugh Walker Dunfermline MUCH is said, and rightly so, about large-scale electricity generators bespoiling the landscape. I feel that we would be better served by using marine generators to draw energy from tidal flow, particularly where narrows are formed such as at Corran and the nearby entrance to Loch Leven. One very good reason for using tidal generation is that the power will be produced for about 18 hours every day and not have downtime like wind generators. They can be small scale to power island or mainland rural communities which ideally will be locally publicly owned and operated, or large scale to feed a new Scotland grid. Another advantage is that high tides are at different times around Scotland's coast thereby giving a steady flow to the grid. As is the case of the marine generator at Strangford Lough in north-east Ireland, there is no impediment to shipping. We could also reset our thinking away from the mega size and think more about the micro scale. How many farms et cetera have a large burn flowing down, well capable of a decent output like the one which outlets into Loch Ard but can barely be seen? We could also make better use of our planning laws as I see new houses and buildings going up with perhaps as little as two or no solar panels PV. Or thermal. M Ross Aviemore LES Hunter (Letters, May 23) admirably articulates the Labour Theory of Property as expounded most notably by John Locke. Nobody can claim outright ownership of the gifts of nature (or God, if you will); only artefacts can rightly be deemed legitimate property. But then the socialist planner in Les takes over, demanding that the whole country be taken into public ownership when this is already the case (the only real landowner is the state, which claims eminent domain). And private hospitals, schools etc should certainly not be exempt from a land-use levy. We could rely on Adam Smith's 'invisible hand' to regulate land questions fairly, if only the state would create a level playing field, ending monopoly and speculation by fully recovering site values for revenue. George Morton Rosyth 'FIVE More Years' of John Swinney would be the death knell of the declining impetus in the independence campaign. The SNP Government should delete the N for National and insert D for Devolution, as they are like nodding dogs towards corrupt Westminster. We need a political body with the word 'independence' at the forefront of its targeted programme. It is years behind time that the current government will have to reform its attitude if it is to establish Scotland as a country and not a county, being pillaged of its assets by the despicable Unionist governments in England. Sandy Coghill Isle of Skye IT'S time to ditch Crown immunity. No-one is above the law, even government ministers. When will the British government stop its long history of aiding, abetting and committing genocidal clearance? The list is not exhaustive. Not unlike Gaza ... they spent the 1700s and 1800s either committing genocide or clearance against the Scots, let one million Irish starve in the 1840s by failing to assist them and exporting the little food they had to England (causing en masse emigration), backed the Nigerian government in the 1960s which led to mass starvation and genocide in Biafra. They pushed for less of a UN troop presence in Rwanda in the 1990s which led to genocide, bombed Iraq on false pretences killing half a million between 2003-2011 for access to oil wells and now Westminster is backing genocide in Palestine. A quarter of MPs have been financially backed by Israel, thus giving Israel massive influence over UK policy-making. Yet, none of this represents the vast majority of British voters. So, if our MPs are not representing us, who are they representing? If the Northern Irish, Welsh and Scots have any sense, they will make the three devolved governments come together and agree to hold a referendum on freedom on the same day for each nation. It's time to kick the British government out. R McCallum Dalry
Scotsman
19-05-2025
- Business
- Scotsman
Two countries divided by real estate policies
What Scotland can learn from UK Government incentives and regulatory changes Sign up to our Scotsman Money newsletter, covering all you need to know to help manage your money. Sign up Thank you for signing up! Did you know with a Digital Subscription to The Scotsman, you can get unlimited access to the website including our premium content, as well as benefiting from fewer ads, loyalty rewards and much more. Learn More Sorry, there seem to be some issues. Please try again later. Submitting... The real estate markets in Scotland and England present unique challenges and opportunities driven by marked differences in taxation, policy, and governance which influence investment and growth in their respective landscapes. Scotland is a compelling destination for real estate investment, but various challenges have hampered its potential. Conversely, despite rising prices and cost inflation, England and particularly London and the south-east, continue to attract domestic and international investors. Advertisement Hide Ad Advertisement Hide Ad Property taxation is one of the most marked differences. Scotland adopted Land and Buildings Transaction Tax (LBTT) while Stamp Duty Land Tax (SDLT) remains applicable in England. Fundamentally, LBTT is designed to be more progressive but higher tax rates for more expensive properties arguably deters investment in what is a critical segment for market vitality. It has also driven higher average tax rates in the commercial property sector in Scotland. Barry McKeown says government policy has significant influence on investment in Scottish real estate In contrast, SDLT in England has seen a series of adjustments intended to stimulate the housing market, which have helped to sustain market activity, particularly in challenging economic times. Government policy also has significant influence. Recent policy changes by the UK government - including measures to accelerate the planning process, reduce bureaucratic hurdles and enable quicker commencement of construction projects - are designed to stimulate growth. A further measure has been a significant increase in funding for affordable housing projects, addressing the chronic short-fall in housing stock for lower-income families. The UK government has also incentivised developers to incorporate sustainable practices in projects, with tax breaks for environmentally friendly construction projects. Furthermore, community-led housing initiatives aim to empower local communities to develop housing solutions that fit their specific needs, while investment in urban regeneration programmes aims to revitalise neglected and underdeveloped areas. Advertisement Hide Ad Advertisement Hide Ad Conversely, in Scotland, systemic issues continue, with a housing crisis characterised by a shortage of affordable homes and rising homelessness. Recent regulatory controls like the 'rent freeze' have impacted on levels of private investment in the housing sector and arguably further exacerbated the problem. Recent proposed changes to include Purpose Built Student Accommodation (PBSA) within the sectors covered by the proposed Housing (Scotland) Bill will affect that sector in the same way the rent freeze all but killed Scotland's Build-to-Rent sector. Whilst the Scottish Government's aim to increase housing supply and investment in social housing is ongoing (and a key part of the recently announced Programme for Government), we urgently need a more streamlined planning process - with simplified planning regulations and clear, consistent policy frameworks to help attract private investment in the sector. We need less regulatory controls to attract investment and increase stock in the private rental sector. Proper consultation with the investment and development industry is essential to understand the massive impact such regulation can have. Real estate investment is crucial for economic growth. Enhanced support for private investment and targeted tax incentives are key to attracting investment and in turn will drive employment and stimulate local economies. Without question, maintaining investor confidence through stable and predictable policies is critical. Advertisement Hide Ad Advertisement Hide Ad Whilst both Scotland and England face distinct challenges in their respective real estate markets, UK Government policy initiatives in England specifically targeted at the real estate sector could yet offer invaluable insight. Strategic policy interventions, investor-friendly taxation and a focus on sustainable development can unlock substantial growth and investment opportunities and might help Scotland revitalise its own real estate sector, solve the housing crisis and deliver on a wider growth agenda.
Scotsman
15-05-2025
- Business
- Scotsman
Scotland's punitive property tax regime defies explanation
The current LBTT policy is simply political posturing which makes little or no economic sense, writes David J Alexander Sign up to our Scotsman Money newsletter, covering all you need to know to help manage your money. Sign up Thank you for signing up! Did you know with a Digital Subscription to The Scotsman, you can get unlimited access to the website including our premium content, as well as benefiting from fewer ads, loyalty rewards and much more. Learn More Sorry, there seem to be some issues. Please try again later. Submitting... When a major think tank states 'it is hard to think of any economically rational strategy that would justify recent policy on Land and Buildings Transaction Tax (LBTT), which has made Scotland's most ill-conceived tax ever bigger and more damaging' you would assume it would make policy makers review their ideas. Not a bit of it. Those were the words of the Institute for Fiscal Studies (IFS) in their report 'Assessing Scottish tax strategy and policy' yet LBTT remains central to the Scottish Government's policies. The IFS stated that 'Scotland's increase in the surcharge in land and buildings transaction tax (LBTT) on the purchase of second and rental homes, from 6 per cent to 8 per cent… continued a trend of increases in this 'additional dwelling supplement'', and 'the move makes an already highly economically damaging tax even worse.' Advertisement Hide Ad Advertisement Hide Ad It goes on to state: 'The change will encourage owner-occupation but will make it even more difficult and expensive for those who remain in the rental sector – tenants (who are likely to face higher rents as a result of the policy) as well as landlords. And the policy does not just penalise the rental sector; it penalises transactions within the rental sector. Preventing a landlord who wants to sell their property to another landlord from doing so is bad for both landlords and tenants.' David J Alexander is CEO of DJ Alexander Scotland Ltd (Picture: Laurence Winram) Which brings us to the latest monthly statistics on revenues from LBTT which show that this is now £699.1m (18.6 per cent higher than same period the previous year) for the period between May 2023 and April 2024. Of the £699.1m taxes raised £211.8m is from the additional dwelling supplement (ADS) which is charged on second homes and properties purchased by landlords and property investors to rent. This is now 30.3 per cent of the total raised and is £50.8m higher than the previous 12-month period. Almost all the residential taxes arose from properties sold for more than £325,001. The 19,100 transactions above this threshold collected £405.1m which is 83.1 per cent of the total £487.3m raised in LBTT (this is the figure for residential sales with the ADS figures removed). This means that the average tax levied per transaction was £21,209. Advertisement Hide Ad Advertisement Hide Ad The IFS understands that the current LBTT policy is simply political posturing which makes little or no economic sense but plays up to the idea that punishing 'the rich' is progressive. The fact that the majority of people who buy a house valued at over £325,000 would never consider themselves rich is irrelevant. Yet the large amounts of tax paid by property investors is testament to their faith in the Scottish market. These taxes also do not seem to be deterring homebuyers. But we need a level playing field with our UK counterparts and we need – as the IFS point out – a proper tax strategy in which there is a reasonable explanation of why these taxes are so high and what benefits accrue from them. There must be another way to raise revenue which does not see homebuyers and property investors as cash cows who can endlessly be taxed. If higher property and income taxes start to deter individuals and companies from future investments in Scotland, then far from being progressive taxation it will be regressive.
Scotsman
05-05-2025
- Business
- Scotsman
Even the savviest of house-hunters can benefit from professional advice
Don't end up paying more tax than you need to, writes Kathryn Johnston Sign up to our daily newsletter – Regular news stories and round-ups from around Scotland direct to your inbox Sign up Thank you for signing up! Did you know with a Digital Subscription to The Scotsman, you can get unlimited access to the website including our premium content, as well as benefiting from fewer ads, loyalty rewards and much more. Learn More Sorry, there seem to be some issues. Please try again later. Submitting... Many people like to think of themselves as savvy house-hunters, but there really is no substitute for professional advice to avoid expensive pitfalls. After all, why pay more tax than you need to? There's nothing like a furore over tax to stoke an argument. To some, tax planning is an entirely sensible process to reduce liabilities, but to others it's a grey area that involves dodging your responsibilities. I suspect such polar opposite opinions will rarely find common ground. Advertisement Hide Ad Advertisement Hide Ad A Scottish politician has recently been accused by opponents of dodging tax by building a property portfolio in the north of England rather than Scotland, thus avoiding higher rates imposed by his own government. In fact, the current First Minister himself is on record as referring to altering tax affairs as technically possible, but morally wrong. Kathryn Johnston is a Private Client Associate, Murray Beith Murray But as Shakespeare's Hamlet might say, there's the rub. By shifting your property portfolio south of the border, you can sometimes save a considerable sum of money on the Additional Dwelling Supplement (ADS) and Land and Buildings Transaction Tax (LBTT). For all the apparent tax outrage this politician's planning has caused, it has also highlighted the differences between Scotland and England and the considerations buyers should, quite sensibly, take into account around second home ownership. And for that, whatever side of the divide you stand, professional advisers should be grateful that an important issue now has a higher profile. It really is vital to think hard about the location of your second home and crucially to take professional advice at the outset of your house hunting. ADS in Scotland currently sits at 8 per cent, having been bumped up from 6 per cent by the Scottish Government from December 2024. Indeed, it sat at what now seems a paltry 3 per cent up to 25 January 2019, so it's now much more of a material consideration for second home buyers. Its southern counterpart, known as Stamp Duty Surcharge, stands at 5 per cent. The rates at which LBTT is charged is also different and more punitive in Scotland for all purchase prices between £325,000 and £1.5 million. However, home ownership really is about location, location, location and it may well be that paying slightly more for your favoured spot is a price worth paying. Advertisement Hide Ad Advertisement Hide Ad But here is an unintended consequence – there's some leeway in the system to allow for the vagaries of the property market as buyers, who are simply looking to move house, often conclude a deal for a second home before they have managed to sell their own. However, any leeway was in short supply for one client who was looking to sell their original property, having purchased a new home first, within the allowable time frame – at that stage 18 months. One family member, however, became seriously ill which rendered the new home they'd purchased totally unsuitable. They then sold this second property and tried to reclaim the ADS paid, but this application was turned down by Revenue Scotland, which collects devolved taxes. The organisation, whilst sympathetic to our clients, confirmed that, unlike HMRC, it had no discretion to review cases and must simply apply the legislation. In short, if conditions are not met, there is no repayment. Moving house understandably often appears near the top of the charts of life's most stressful events. Taking professional advice as early as possible is one way to mitigate that – and it could also bring financial benefits.
