Gareth Davies MS spoke yesterday during a Welsh Conservative Senedd debate calling for the abolition of Land Transaction Tax, commonly known as ‘Stamp Duty’, on primary residences, arguing that the tax is contributing to problems in Wales’ housing market.
Mr Davies referenced the impact of the tax on first-time buyers, families seeking to move home, and older residents looking to downsize, outlining his view that the housing market in Wales is increasingly inaccessible and that current policies are limiting mobility and home ownership. He highlighted trends showing declining home ownership among younger adults, noting that the proportion of 25 to 34 year-olds who own their own home has fallen sharply over recent decades from 67% in 1991 to 39% in 2023. He argued that this decline reflects broader issues in housing supply, affordability and taxation, and warned that home ownership is becoming an unrealistic aspiration for many young people across Wales.
In setting out the case for abolishing Land Transaction Tax on main residences, Mr Davies said the tax discourages people from moving for work, traps families in unsuitable homes, and imposes significant upfront costs at the point of purchase. He noted that the tax raises around £147 million annually from primary residences, representing a small proportion of the Welsh Government’s overall budget, and argued that unallocated funding could have been used to support its removal.
Mr Davies also referenced criticism of stamp duty from independent bodies such as the Institute for Fiscal Studies and Treasury Committee in Westminster which have described the tax as economically damaging and harmful to labour mobility. He stressed that the proposal would apply only to main homes, not second homes, and was aimed at supporting ordinary buyers, with the average cost of a Welsh home being over the threshold for Land Transaction Tax.
Commenting following the exchange, Gareth Davies MS said:
“Home ownership is slipping further out of reach for too many people in Wales with many young people losing out on the opportunity to have a stake in society which was more obtainable for older generations than their own.
“Land Transaction Tax makes it harder to move, harder to downsize, and harder for young people to get on the property ladder, punishing aspiration and affecting ordinary working people.
“If the Welsh Government is serious about fixing the housing crisis and restoring home ownership as a realistic aspiration, it should scrap Land Transaction Tax on main homes as a step towards fixing our broken housing market.”
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