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Labour slams Government attempts to limit ‘poisonous’ overseas property cash

MPs say extra stamp duty has had little impact on investment activity while register of overseas entities has yet to appear.

Nigel Lewis

labour abena appong property

Labour has criticised the Government’s attempts to clamp down on excessive and often dubious property investment in the UK by overseas companies and millionaires.

During a debate on the impact of the government’s 2% Stamp Duty surcharge on property purchases by overseas entities and investors, Labour shadow Exchequer Secretary Abena Appong-Asare chided the Chancellor Rishi Sunak for ‘watering down’ the original proposal to charge 3%.

The additional Stamp Duty, which formally launched in last year’s Spring budget, was at the time greeted with a sigh of relief by the industry, with many tax experts pointing out that it brought UK into line with many other mature property markets around the world.

But Appong-Asare also grilled the Government on its failure to set up a register of overseas entities as promised five years by David Cameron.

She said some £100 billion of property had been bought in London via illicit wealth since 2008 and that the number of likely deals involving dodgy cash has risen from 14,000 to 63,000 a year.

“The tidal wave of dirty money is poisoning the housing market for ordinary people,” she said.

“There is growing evidence that the purchase of UK property to launder illicit finance from abroad has a direct impact on housing prices.

“This is not just about luxury properties. There is a ripple effect, where activity at the top causes a rise in prices throughout the market. As demand outstrips supply in high-value areas, buyers look out to more affordable places.”

Responding on behalf of the Government, Financial Secretary to the Treasury Jesse Norman said the Stamp Duty on overseas buyers had gone further than the original 1% proposed but would not be drawn on when the Government’s register of overseas interest would be ready to roll.

Read the debate in full.

June 2, 2021

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