The Housing, Communities and Local Government Committee has called for significant reforms to Stamp Duty Land Tax, arguing the current system creates barriers to homeownership and slows property market activity.
In a report published this week, the cross-party committee of MPs stated that Stamp Duty Land Tax “reduces the affordability of home ownership, slows the property market, and ultimately damages the economy.”
The committee is demanding the government launch a consultation on potential reforms by the end of 2026. Options under consideration include abolishing the tax entirely, reducing rates, revising thresholds to reflect local property values, and updating existing reliefs and exemptions.
Revenue implications
While acknowledging Stamp Duty as a “valuable source of revenue for public finances”, the report concluded that the tax “must not be maintained in its current form and needs to be reformed.”
Treasury data shows Stamp Duty receipts totalled £4.3 billion in the first four months of 2026, approximately 6% lower than the same period in 2025. The decline comes as estate agencies continue to consolidate amid challenging market conditions.
Declining homeownership rates
Committee Chair Florence Eshalomi highlighted the broader context of falling homeownership rates. “Rates of homeownership in England have declined over the last 20 years,” she said. “For many people, and especially for those unable to draw upon the bank of Mum and Dad, the prospect of owning a home is little more than a pipe dream.”
The committee recommended that any Stamp Duty review should be conducted alongside Council Tax reform to address the wider housing affordability crisis.
A Treasury spokesperson told The Telegraph that first-time buyers currently pay no Stamp Duty on properties worth up to £300,000 and can claim relief on purchases up to £500,000. The government has not yet responded to the committee’s call for a consultation.
The property sector has long debated the impact of transaction taxes on market liquidity. While technology adoption increases across the sector, tax policy remains a key factor affecting buyer behaviour and investment decisions in property markets.
