Ahead of the General Election, the Conservative party has proposed an increase in stamp duty for foreign buyers of UK property.
The proposals outline that foreign buyers would have to pay three per cent more in stamp duty than UK residents, with the aim of helping people get onto the housing ladder.
The Government had previously proposed a one per cent increase for foreign buyers, while Labour is also proposing a levy on overseas firms purchasing housing in the UK.
Under current rules, foreign individuals and firms can buy homes with the same ease that a UK resident can, but many have expressed concern about the property investment market.
The charge would be paid in addition to all other stamp duty charges, with the measure set to affect more than 70,000 transactions every year.
It is believed that the levy could raise £120 million per year, with the Conservative party also aiming to tackle vacant housing stock by allowing local authorities to increase council tax by up to 500 per cent if a property is left vacant for longer than six months.
Rishi Sunak, Chief Secretary to the Treasury, said: “Evidence shows that by adding significant amounts of demand to limited housing supply, purchases by non-residents inflate house prices.”
However, a study has indicated that the levy may not be high enough, with other areas that have a high volume of foreign buyers, such as Singapore and Vancouver, enforcing a 20 per cent surcharge.
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