Cut stamp duty below GBP 750,000

Tax baseline

The costable scenario follows Reform's 2024 Contract: no SDLT below GBP 750,000, 2% from GBP 750,000 to GBP 1.5m, and 4% above GBP 1.5m.

• Applies to England and Northern Ireland.
• Most transactions fall below GBP 750,000.
• Rates above GBP 750,000 also fall.

Core trade-offs

Buyers face lower transaction tax, but sellers may capture part of the gain through higher prices. The Exchequer loses revenue and demand rises without adding supply.

• Buyers and sellers gain from lower tax.
• Treasury loses property-transaction receipts.
• Prices may rise where supply is tight.

Illustrative fiscal impact

+GBP 4.0bn to +GBP 12.0bn. Central estimate: +GBP 7.5bn.

• Positive numbers mean public-finance pressure; negative numbers mean Exchequer savings.
• GBP 750k threshold is the main scale marker.
• Gross costs and receipt offsets are separated in methodology.
• Behaviour and pass-through widen the range.
• This is not an official costing.

Economic impact by 2027-28

• Jobs: Housing-market activity may support estate agents and removals, but no supply guarantee exists.
• Wages: No direct wage effect; wealth gains accrue mainly to property owners and movers.
• Prices: Likely raises prices in supply-constrained areas if demand increases.
• GDP / productivity: Could improve mobility, but output gain is limited without housing supply reform.

Assessment

Lower stamp duty can improve mobility, but a very high zero-rate threshold is mainly a property-market tax cut. In tight housing markets, part of the benefit is likely capitalised into prices. The policy is fiscally costly unless paired with serious supply reform or another property-tax base.

Confidence: Medium-low. HMRC ready-reckoners help, but transaction volumes and price capitalisation make large threshold changes uncertain.

Main risks

• Price capitalisation: Sellers may capture some tax relief through higher sale prices.
• Regressive gains: Higher-value homeowners and movers gain more than renters or non-movers.
• Supply gap: Demand rises without new supply can worsen affordability pressures.

Safeguards

• Pair with binding housing-supply reform.
• Publish regional price and buyer-incidence analysis.
• Consider replacing SDLT with annual property taxation.

Academic evidence

UK government evidence

Sources

• PolicyLens illustrative scenario methodology: Cut stamp duty below GBP 750,000 Internal - PolicyLens, 2026
• Direct effects of illustrative tax changes Official tax data - HM Revenue and Customs, 2026
• Our Contract with You Party policy document - Reform UK, 2024
• Housing Market Responses to Transaction Taxes: Evidence From Notches and Stimulus in the UK Academic article - Best and Kleven, Review of Economic Studies, 2018
• Transfer Taxes and Household Mobility: Distortion on the Housing or Labor Market? Academic article - Hilber and Lyytikainen, Journal of Urban Economics, 2017
• Our Policies Party policy source - Reform UK, 2026

Other Reform UK policies

• Raise income-tax thresholds
• Cut household energy taxes
• Cut fuel duty by 20p
• Raise inheritance-tax threshold to GBP 2m
• Cut corporation tax to 15%
• Raise VAT threshold to GBP 150,000
• Abolish IR35 rules
• Replace some high-street business rates