A senior Tory has backed Kemi Badenoch’s plans to abolish Stamp Duty for those buying their main home in England and Northern Ireland and suggested its reform could well be part of Rachel Reeves’ plan for the Autumn Budget.

David Willetts, who was a business minister until 2014 and now sits in the Lords as well as being President of the Resolution Foundation, has told the BBC that reform of the Stamp Duty system is long overdue because it is a “tax on transactions, so it stops mobility in the economy”, he said.

“In every sense, it stops people trading down, perhaps when they’re older and want her downsize [and] it also inhibits people moving to a different area, perhaps where the jobs are better, so there is a general view that, of course you need to tax properly that taxing the transactions, although it’s a convenient moment for the Treasury is actually quite bad for the economy.”

Pressed by BBC’s Today programme yesterday on how a Conservative government would find the circa £9 billion raised by Stamp Duty every year, Lord Willetts – who is due to speak at The Negotiator Conference & Expo on 28^th November – said Badenoch’s tax revenue would be covered by “financial discipline and bringing down borrowing”.

Priorities

Lord Willetts also suggested strongly that reforming Stamp Duty is likely to be on Chancellor Rachel Reeves’ list of fiscal priorities in her looming Autumn Budget, saying such a move would be very ‘tempting’ for her.

He also said council tax is also ripe for reform, saying: “To be honest, if you were looking at taxing property, reforming the regressive Council Tax, which is particularly hard for low-income families, and also has a very odd, a regional effect.

“Because London ends up undertaxed, compared with much poorer parts of the country [so] if you wanted to do something, you could reform Stamp Duty and reform Council Tax alongside it,” he added.

Read more about Rachel Reeve’s stamp duty plans.