“The ‘slab’ system has long been criticised for the way in which a single pound’s difference in purchase price can trigger a big jump in stamp duty payable, leading to bunching in the house sales around thresholds. The ‘slice’ system, as modelled by the Scottish system to take effect next year, should smooth this out and will be attractive to those purchasing dwellings under £925,000. It will take effect from tomorrow subject to a choice where contracts have been exchanged.
“The Government says that 98% of house-buyers will be the same or better off under the new system. But those savings will effectively be paid by those buying in London and the South East, where higher property values produce greater, and sometimes exponentially greater, tax charges. The new top rate is 12%, in common with the Scotland system, for properties over £1.5 million. Those with houses in this bracket will pay a greater price and the prime/super-prime residential market will suffer another blow. These changes may in part be prompted by opposition proposals for a mansion tax.”
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