I refer to my previous blog in June 2013 about the Land and Building Transactions Tax (Scotland) Bill. As I previously indicated this will be a progressive tax however the actual rates of LBTT are not yet known and I think it will be unlikely that they will be revealed prior to the Referendum in September. I was at a seminar held by Savills where the LBTT was discussed and, if the rates and approach are as they are set out in the consultation document, then LBTT would favour residential sales at £180,000 or less however sales above £200,000 would incur a higher rate of tax than at present. Whilst I do not disagree with the progressive approach to the tax, I am concerned that it will have a negative impact on the residential housing market in Scotland by making it considerably more expensive for people who are moving in the £180,000 to 1.5million price bands. This could lead to a further brake on the property market when Government should be doing all it can to encourage activity. I would say that the above rates apply to residential properties and there are different rates applicable to commercial properties.
I will report as soon as I have more information.Lindsay Darroch Partner & Head of Property