ARTICLE · 15 OCTOBER 1999

CIOT Calls For Reform Of Stamp Duty

KPMG

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With recent increases in the rates charged, stamp duty has become a very important business tax. Duty is now charged on conveyance or transfer on sale of (for example) freehold land at a rate of up to 3.5%, compared with 0.5% on shares. Therefore, if a business is sold, and £1 million of the price is attributable to the factory, the stamp duty difference between a sale of the company's shares and a sale of the company's assets will be (other things being equal) £30,000.

However, the archaic and arcane structure of the tax remains unreformed; the Chartered Institute of Taxation has issued a paper calling for it to be modernised.

The CIOT's paper includes both radical proposals for structural reform and detailed recommendations for specific improvement. In summary, the CIOT's main recommendations are as follows.

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