Chancellor urged to relax tax rules

In their submission for this week’s Budget, law firm Trowers & Hamlins argues that a number of private equity funds and Gulf-based funds are discouraged from investing in the sector. They have called for the government to relax SDLT rules on real estate investment trusts so that these investors are attracted to the residential sectors.

The firm also says the government should remove a VAT hurdle that prevents housing providers from cutting their costs by sharing administrative services. At the moment, providers pay 17.5 per cent VAT on fees paid to other providers.

The submission says: ‘Removing this VAT barrier will have little negative impact on tax revenues the VAT charged on feed between registered providers acts as such a substantial disincentive that the government currently collects very little tax from this source.’

The Royal Institution of Chartered Surveyors is also calling for the government to minimise the impact of capital gains tax changes, which it claims could damage the sector’s recovery. RICS is asking for the Budget to use CGT taper relief to encourage landlords to keep their properties in the private rented sector for several years before selling them.

Homelessness charity Thames Reach has asked for strong taxes on super-strength alcoholic drinks. Its submission says: ‘Study after study in recent years has shown that people’s behaviour around alcohol consumption follows price.

‘Our request is that in your Budget of June 22, these dangerous super-strength drinks get taxed to such an extent that their consumption diminishes dramatically.’

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