The Chancellor today caught more of London’s billionaire property owners in the stamp duty net by increasing the number who will have to pay the tax, even if the buildings are owned through a company.
Wealthy foreign investors have habitually owned properties in London through companies to avoid stamp duty, but the Chancellor has been progressively closing the loophole.
Having already ordered stamp duty to be paid on properties of above £2 million, he said that limit would fall to just £500,000 from midnight.
That will mean that practically every property in London bought for investment purposes by the international rich through companies will fall into the 15% tax bracket. “Many of these are empty properties held in corporate envelopes to avoid stamp duty,” he said.
It was one of several attacks on the very wealthy, including new taxes on private jets in the form of an extension of air passenger duty.
Also, people who sign up to tax-avoidance schemes will be required to pay taxes upfront while HM Revenue & Customs or the courts decide whether they are legal.
If they are approved after that process, the tax will be repaid with interest. That should bring forward £4 billion of tax revenues.
On tax avoidance, Mr Osborne said he was increasing HMRC’s budget to stop non-compliance.
He added: “We will give HMRC modern powers to collect debts from bank accounts of people who can afford to pay, but have repeatedly refused to, like most other Western countries.”
