Minister writes to government over stamp duty concerns

The on-going saga of stamp duty reform took another twist this week when shadow financial secretary to the Treasury Mark Prisk MP wrote to the government to voice his concerns.

In a letter to Paul Boateng (pictured)​, chief secretary to the Treasury, he has called on the government to honour its commitment that 60 per cent of commercial leases would be exempt from the tax.

In the letter Mr Prisk said: "It has since become clear that this is completely at odds with evidence from business.

"The British Retail Consortium survey of 125 retailers and 10,000 outlets shows that just 29% would be exempt and I now understand that this proportion is mirrored amongst pubs, bars, restaurants, clubs and offices.

"The result is that the new tax, as currently enacted, threatens the clear majority of small businesses, despite your promise."

The government wants to introduce a stamp duty tax in December this year, which will see licensees and other businesses charged duty based on the length of the lease rather than one year's average rent. It is feared by the trade that the new reform will cost licensees thousands of pounds in additional costs.

The British Retail Consortium's July 2003 survey of 10,231 outlets, over 7,500 leases and 125 members, shows:​

• 71 per cent of leases would be liable for new stamp duty land tax
• Cost to retailing alone of £228m per annum
• 75 per cent of retailers will limit expansion if the Government's proposals are implemented
• 60 per cent of retailers would cut jobs