12 March 2020  /  By Andrew Ellinas LL.B.

Budget 2020

Budget 2020

There was no mention of the Mansion Tax or the so-called ‘First Homes scheme’, where first-time buyers, ex-service personnel and key workers buying in their local area have been promised a 30% discount.

Stamp duty increased for overseas buyers

An additional tax on overseas buyers of UK property was confirmed in the budget.  Non-resident buyers of homes in Britain will have to pay an additional two per cent stamp duty. 

Until now, non-resident buyers have been subject to the same stamp duty rules as buyers living in the UK, ranging from 0 per cent for properties costing less than £125,000 up to 12 per cent for homes over £1.5 million.

Many cities with global property markets already have similar levies in place. The new surcharge for overseas buyers is expected to affect 70,000 of the UK’s total 1.2 million annual property transactions.

The Chancellor said the money raised from this tax will be used to fund 6,000 new homes for homeless people.

The surcharge will take effect from April 2021, leading to speculation that there could be a surge in overseas buyers before the deadline. 

The removal of unsafe cladding 

The Chancellor confirmed that there will be an additional £1 billion allocated for the removal of unsafe cladding from residential buildings taller than 18 metres. 

The Government pledged £400 million in 2018 for the removal of Aluminium Composite Material (ACM), the type used at Grenfell Tower in North Kensington, from social housing tower blocks, and last year an additional £200 million was allocated for the private sector.

Promising to go beyond dealing only with ACM, Chancellor Rishi Sunak said that the new £1 billion fund will "make sure that all unsafe combustible cladding will be removed from every private and social residential building above 18 metres”.

New homes building 

Chancellor Rishi Sunak used his first Budget statement to announce a new £12 billion multi-year extension of the Affordable Homes Programme (AHP).  This is a £3 billion boost to the current programme which was put in place in 2016 and is due to end next year.  

The funding, distributed by Homes England and the Greater London Authority, is used to support housing associations and to encourage developers to build new affordable housing.

Funding of £1.1 billion has also been confirmed through the Housing Infrastructure Fund to open up 70,000 homes in areas of high demand across country.

Statutory Sick Pay

For individuals Statutory Sick Pay (SSP) will be extended for those advised to self-isolate, and those caring for others who self-isolate, and support through the welfare system for those who cannot claim SSP, as well as a hardship fund.

Business rates Relief

Support for businesses includes expanded Business Rates reliefs, a Coronavirus Business Interruption Loan Scheme to support up to a further £1 billion lending to SMEs, a £2.2 billion grant scheme for small businesses, and a dedicated helpline for those who need a deferral period on their tax liabilities.

Infrastructure

The budget was also huge in terms of fiscal investment into the economy with more than £600bn to be injected into infrastructure over the next 5 years.

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