To ask the Chancellor of the Exchequer how much additional duty he estimates will be raised from the proposal to change stamp duty on leases in each of the next five years; how many additional property transactions he estimates will come within the provision in each of the next five years; and what estimate he has made of (a) the compliance cost and (b) the number of additional staff required to implement the measures in each of the next five years.
The estimated additional duty from the proposed reform of lease duty was published in table A2.1 of the Budget report.
Under the proposals, the revised charge on leases will value the rent payable over the term of the lease at its net present value (NPV) and there will be a single rate of 1 per cent. of the NPV of rental payments, where the NPV exceeds the zero rate band threshold of £60,000 (for residential property) or £150,000 (for non-residential property).
As a result of the introduction of zero rate thresholds it is expected that, in fact, fewer transactions will be within the scope of the charge once stamp duty land tax is introduced than are currently within the scope of charge. It is estimated that over 90 per cent. of residential leases and around 60 per cent. of commercial leases will be exempt from lease duty.
Estimates of compliance costs, and other implementation costs, will be included in a full Regulatory Impact Assessment which will be published when stamp duty land tax is implemented.
It is not anticipated that the number of staff in the Stamp Office will increase as a result of the proposed reform of lease duty.