A tax avoidance win which a General Anti-Tax Avoidance Principle Bill would have delivered so much more easily

Posted on September 20 2012

The government has won an important legal victory in its fight against stamp duty avoidance, in a blow to similar schemes used to dodge an estimated £170m of tax.

A tribunal has ruled against a company that used a rule, originally designed to prevent double taxation, to avoid £290,000 of stamp duty on a 2006 purchase of a business park in Stockton-on-Tees.

The victory against the misuse of “sub-sale” relief, which is frequently employed to avoid stamp duty, is seen by HM Revenue & Customs as a landmark case as it tries to confront what George Osborne has branded the “morally repugnant” culture of property tax avoidance.

Sub-sale relief was originally devised as a way to exempt legitimate intermediaries, such as housebuilders, from paying stamp duty twice — first when they bought the land and again after selling the finished house.

Now of course a win has to be applauded: I'm always pleased by them.

But, let's also be clear that this was simply abuse of a law introduced with good intent by the tax avoidance industry and this result could have been achieved so much more easily if we'd had Michael Meacher's General Anti-Tax Avoidance Principle Bill.

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One Response

Carol Wilcox says:

September 20 2012 at 2:32 pm

Stamp Duty Land Tax is a stupid tax anyway. If people want or need to move why put obstacles in the way? An average second-rung-on-the-ladder home incurs c Â£10000 SDLT, deterring many families from moving to more suitable accommodation as their needs change.

LVT would replace all other property taxes and is loophole resistant.