Why stamp duty should be scrapped

In his last Budget, George Osborne tinkered with stamp duty. Tim Bennett explains why he would have preferred the chancellor to go a lot further.

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  • Impromptu

    I agree Tim. Stamp duty is supposedly about state-guaranteed proof of ownership. The process of registration has never been any more (for want of a better word) taxing for an asset worth £1m than an asset worth £1,000 – it’s still one piece of paper, just with more zeros on it. Stamp duty originally operated that way. The ad valorem approach is, frankly, a 200 year old con that we’re still stuck with, and the situation was made worse by the tampering of the son of the manse.

    I do however feel that stamp on shares is potentially a useful political bargaining chip with the EU. The UK can fairly justify opposing current Tobin tax proposals on the grounds that we already have one. This stance might give us a chance of negotiating an exemption (Germany, for one, may well seek the same with regard to its mandatory regional and “church” taxes). In the event the proposed financial transaction tax is forced through pari passu for all EU member states, there can be very little argument left for retaining domestic stamp duty on shares.

    Of course, the goose that didn’t just hiss during plucking, but bit back, was America. EU commissioners might do well to reflect on that little episode in history…