Boris wants Stamp Duty

Boris JohnsonThe Mayor of London has called on the government to allow him to retain stamp duty on London transactions, to allow investment in a long-term housing plan.

The Mayor says this will help him avert “a housing crisis that threatens (London’s) economic growth and global competitiveness”.

Boris Johnson is calling on the coalition government to allow London to retain all stamp duty receipts raised on its property sales, estimated to be worth £1.3 billion a year, to ensure it can build the million homes that London will need by the mid 2030s.

The Mayor says his proposal would give the capital a stable income stream to create a 25 year plan that will not just solve its housing needs but would create hundreds of thousands of long-term jobs and give a massive boost to its economy benefiting the whole of the UK.

In a speech at the Chartered Institute of Housing the Mayor said that London cannot rely solely on a ‘planning-led’ system which has delivered only half the number of homes needed for 20 years. He said that London, not Whitehall, is best placed to address the problem.

Boris contended that, with the majority of London transactions paying at least 3% stamp duty and new levies on homes costing over £2 million focused largely on central London, it is increasingly becoming a London tax. The Mayor argues that it is right that London should retain this revenue for the benefit of Londoners. He noted that Scotland will retain its Stamp Duty receipts from 2015 and Wales is likely to follow suit.

He said, with UK capital expenditure constrained and with no housing settlement yet agreed beyond 2015, the move would enable City Hall to borrow on the capital markets against this revenue stream. This could provide capital for infrastructure investment to unlock housing growth, kick-start the many stalled developments in the city and help make longer-term commitments to regeneration of existing housing estates.

He also asked for borrowing limits on town halls to be removed to allow them to invest in more neew homes, and for the transfer of surplus government land to City Hall to maximise development opportunities.

Boris Johnson, said: “Since I was elected London’s population has grown by 600,000 and is forecast to rise by a further million at least over the next 25 years. If we do not come up with a new plan to build the homes we need, this great city will suffer and the whole country will feel the consequences.

“What is needed now is a radically different approach which optimises City Hall’s role, unlocks the potential of the capital’s boroughs, allows developers including housing associations to up their game and creates a stable supply of land for housing. Above all, London needs a stable funding stream which will support and accelerate its housing and infrastructure delivery.

“Even in the toughest of economic times London has shown that with fresh thinking it can deliver, with record affordable house building figures in my first Mayoral term. So I am calling on the coalition to give us the tools and we will solve the crisis, supporting and creating hundreds of thousands of jobs and boosting economic growth across the UK along the way.”

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