MPs back Stamp Duty cut as Labour queries its benefits

A Bill to bring the Government’s Stamp Duty reductions into legislation reached its second reading in the Houses of Parliament this week despite opposition from Labour MPs.

A Stamp Duty overhaul is one of the remaining tax cuts from former Chancellor Kwasi Kwarteng’s controversial mini-Budget.

The changes were introduced immediately for homebuyers but the Government has also introduced a Stamp Duty Land Tax (Reduction) Bill to formalise the changes.

The Bill was introduced this week for a vote whether to pass to a second reading, described as a procedural requirement.

The legislation has passed to its second reading due to support from Tory MPs, but Labour used the parliamentary debate to query the benefit of the changes.

James Murray, Shadow Financial Secretary to the Treasury, questioned why there were no timings for other stages of the Bill, suggesting it could still be overturned by new chancellor – for now – Jeremy Hunt.

Murray said: “It would be easy for us as the Opposition simply to vote for the Stamp Duty cut today, but it would not be right and it would not be responsible. 

“At a time when our economy is reeling from the long-term damage the Conservatives have done, when current and future homebuyers are facing spiralling and prohibitive mortgage costs and when we are still flying in the dark as the Tories refuse to publish the Office for Budget Responsibility’s forecasts, this is not the time to spend £1.7 billion a year on this tax cut.”

He said there was more the Government could be doing to support the housing market and to help people to get a secure and decent home that they can afford. 

This includes introducing a mortgage guarantee scheme, raising Stamp Duty for foreign buyers and to give first-time buyers first dibs on newly built properties. 

Labour MPs Tulip Siddiq and John McDonnell also spoke out against the Bill, claiming that it will mainly support landlords and second home owners.

She added: “The Government’s last-minute decision only to give the Bill its second reading  sends a message to the housing market that Treasury Ministers are once again preparing for a u-turn. 

“I would be interested to hear from the Minister today whether he believes that this time next week a Stamp Duty cut will still be Government policy, or whether the Government will once again follow Labour’s advice and drop this ill-thought-out proposal.”

Responding for the Government, Economic Secretary to the Treasury Richard Fuller said: “This measure will boost labour mobility, support hundreds of thousands of jobs and businesses, increase transactions to boost the property industry, and continue the Government’s record of supporting people, including younger people, into home ownership.”

The Bill passed to its second reading, supported by 288 MPs to 150.

An amendment by former Liberal Democrat leader Tim Farron to restrict landlords from benefiting from the changes for additional home purchases was also opposed.