I very much welcome many of the measures in the Finance Bill, particularly the measures on stamp duty. Like many people who called for a stamp duty holiday, I welcomed it when the Government announced it and I am glad to see that it has been one of the most successful stimuli to economic activity that the country has seen. The moribund market is now racing ahead, albeit possibly slightly too fast. I recognise that homeowners need certainty—many of them are in the middle of transactions —so this is good. We are not out of the pandemic yet, so I welcome the Government’s move to extend the stamp duty holiday to the end of June. I also welcome the fact that they are removing the steep cliff edge and replacing it with a smaller cliff edge by tapering it out and extending it at a lower rate until the end of October. Those are both good measures that will keep the housing market going and give certainty to homeowners.
I do not support amendment 81, which proposes that these measures should not apply to second homes, although I understand the social justice argument behind it. The purpose of the stamp duty holiday is to stimulate economic activity, and whether a home is being bought to live in or as an investment property, that still involves economic activity in the housing market. Our focus here is on stimulating the market, and both those activities have equal effect.
Back in 2012, I co-founded an organisation called the HomeOwners Alliance, Britain’s first and only consumer group for homeowners. Our aim was to champion homeowners and aspiring homeowners and to help people to get into the housing market, recognising that homeownership is a valid aspiration for all young people, and indeed older people, and that the primary role of homes is to be lived in. They are not investments or casinos; they are to be lived in, and that should be the role of Government policy.
I wrote various papers on the reform of stamp duty. I will not go on about the details, but there were two particular reforms that I called for. One was an increase in the stamp duty on second homes, investment properties and buy-to-lets. The other was an increase in the stamp duty for non-residential buyers. The Government have already introduced the first of those, and I think they have raised almost as much money from that as they do from residential stamp duty. Now, in this Bill, they are introducing the stamp duty surcharge for non-residential buyers—the people who want to buy homes in this country but who have no intention of living in them. As a country, we have been very generous to such people—far more generous than most other countries—but, as my hon. Friend the Member for Kensington (Felicity Buchan) said, this has a real cost in terms of preventing other people from buying a home that they actually want to live in.
It is very welcome that the Government are introducing the 2% surcharge for non-residential buyers who do not want to live in the UK. It is right that it should start low—2% is quite low; that is often the fee that we pay to the estate agent—but the Government should monitor it. There will be an opportunity to increase that rate, while ensuring that doing so does not have really bad effects on the market but that it does have an effect on demand and helps to free up properties for people who want to buy a home to live in. The money from these measures is being used to house rough sleepers, which is very welcome, but in the longer term as we raise the rate and more money is brought in, I would use that revenue to reduce the burden of stamp duty for those buying homes that they want to live in. As my hon. Friend the Member for Kensington so eloquently said, stamp duty is a big burden for homeowners. Following those thoughts for the future, I will be fully supporting the Government’s policies.