Stamp duty and Brexit dampen property market
Brexit worries and the general election result have taken their toll on the UK-based property and construction sector, with half of businesses viewing the impact as negative and just 9% as positive
10 Nov 2017
The survey by Crowe Clark Whitehill also found that 44% of businesses are unsure as to whether Brexit will bring any benefits, while 77% believe this year’s general election was unfavourable to the property and construction market and the clock is now ticking for the UK government to restore confidence and reassure the industry before the UK formally leaves the EU on 29 March 2019.
More than 70% of survey respondents said that the current UK tax system is unfavourable to the industry, with more than half (55%) viewing stamp duty land tax (SDLT) as the biggest barrier to business growth.
One in five (17%) also criticised the 45% income tax rate for £150,000 plus earners as the biggest deterrent to investment.
Stacy Eden, head of property and construction at Crowe Clark Whitehill said: ‘Some of the uncertainty that currently pervades the industry revolves around what deal the UK government eventually agrees with Brussels.
‘For those in the construction industry, there remain real concerns over the potential barriers to free movement – this has the potential to increase labour costs and reduce the scope of operations due to the potential lack of skilled labour.
‘The recent increases in stamp duty have resulted in a considerable slowdown in the market. While recent stats show that stamp duty receipts have risen, this should not cloud the reality of what is going on in the market.
‘The negative SDLT levy remains a substantial burden and a drag on sector growth.
‘Reducing this burden should be the government’s first step to encouraging much needed investment and liquidity in the market.’
Report by Pat Sweet