Vol. 483 No. 3
184 Mr. Haughey asked the Minister for Finance if he will abolish stamp duty for first time buyers in view of the problems faced by young people buying houses in the Dublin area due to escalating house prices; and if he will make a statement on the matter. [20177/97]
Stamp duty on property has an important role to play in shifting some of the burden of taxation on wage and salary income to property. There is already a full exemption from stamp duty for transfers of new houses with a floor area below 125 square metres. Transfers of new houses with a larger floor area attract stamp duty based only on the site value, subject to a minimum site value of one-quarter of the full value of the house plus site.
The stamp duty yield from the transfer of real property, including second hand houses, for 1996 was £194 million. If the present level of stamp duty on second hand residential property was reduced or if first-time buyers were exempted there would be a significant ongoing cost to the Exchequer. It seems likely that any such exemption would benefit sellers most and would become built into the level of house prices. Apart from reducing Exchequer revenue, with no apparent benefit to the purchaser, such action could therefore further accelerate an already over-heated property market.
