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14 June 2019

The Propertymark Annual General Meeting (AGM) took place on 14 June at the St Martins Lane Hotel, London, attended by a small group of members, some of whom had travelled from across the country. The Annual Report and Accounts had been shared with members earlier in the month and voting for board and presidential roles had been going on for several weeks. Read More...

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Scottish Parliament Approves Budget

Friday 22 February 2019

Holyrood has voted yesterday (21 February 2019) to pass the Scottish Government’s Budget for the next financial year.

Cabinet Secretary for Finance, Economy and Fair Work, Derek Mackay MSP introduced the Budget for the financial year 2019/2020 on 12 December 2018. Governing party, the Scottish National Party, received support from the Scottish Greens for the third year running to agree to the Budget at all stages in the legislative process. This gave the SNP the majority needed to push the Budget through Parliament.

Land and Buildings Transaction Tax

Announced in the Draft Budget in December, The Land and Buildings Transaction Tax (Tax Rates and Tax Bands etc.) (Scotland) Amendment Order 2018 came in to force from 25 January 2019.

The Additional Dwelling Supplement (ADS) of Land and Buildings Transaction Tax (LBTT) for buy-to-let (BTL) and additional property purchases has now risen from three to four per cent.

The lower rate of non-residential LBTT has been reduced from three per cent to one per cent. The upper rate has increased to five per cent with the starting threshold also being lowered to £250,000.

Rate changes do not apply to contracts entered in to before 12 December 2018. Further information can be read in the Budget documents.

Further measures

Local Authorities will now can increase Council Tax by up to 4.79 per cent up from three per cent previously.

Conservative MSP, Murdo Fraser argued that the new Budget will result in families having to pay more tax for less services and described it as an “omnishambles budget.”

Income Tax rates have been maintained, but unlike the rest of the UK, the higher rate threshold has been frozen. Mr Mackay projects that this will raise an extra £68 million in revenue.

The Scottish Government has set aside £50 million in a fund for regenerating high streets and £5 million towards supporting 2,000 women returning to work after a career break.

Debate became particularly heated around the workplace car parking levy, a condition of the Scottish Greens working alongside the SNP to pass the Budget. The levy will mean that employers will have to pay an annual tax to the Local Authority for every parking space provided to their staff, which will then be up to them as to whether this cost will be passed on to employees.

The levy would be an optional choice for Local Authorities. The SNP’s Angela Constance MSP pointed out that English Local Authorities had the same power and only Nottingham City Council had used it.

Other conditions set by the Scottish Greens include legislation for Local Authorities to set a local ‘tourist tax’ and talks to abolish Council Tax. Measures such as the tourist tax and the workplace parking levy will be included in future budgets.

The Finance Secretary also noted that the Budget may have to be changed in the event of a no-deal Brexit on 29 March 2019.

Commenting on the Budget, Finance Secretary, Derek Mackay MSP: “This prepares our economy for the opportunity of the future, enables the transformation of essential public services, and builds a more inclusive and just society.”

Responding to the Finance and Constitution Committee

In January, ARLA Propertymark and NAEA Propertymark submitted a joint response to the Finance and Constitution Committee’s Inquiry into the rise of ADS.

We argued that by increasing the rate of ADS on second and buy-to-let properties, the Scottish Government were making the market less attractive to investors, and for those remaining in the private rented sector, costs would be passed on to tenants through increased rents making the dream of home-ownership less likely.

Instead, ADS should be scrapped to encourage the longevity of the private rented sector. To aid First Time Buyers, the Scottish Government should instead focus on a programme of housebuilding and property repurposing.

Get in the know

If you’ve not done so already, book your place at the Propertymark Scottish National Conference, which takes place on 13 March in Glasgow, to learn more on the latest legal updates to the political landscape and legislative change.

We will continue to support members with information and guidance as developments arise.