British homeowners are £10 billion a year worse off than they were a decade ago, according to a new report.
The Council of Mortgage Lenders (CML) has said that inheritance tax and stamp duty are proving to be financial burdens for homeowners.
When the removal of tax relief on mortgage interest is also taken into consideration, homeowners are left even more out of pocket than they were 12 year ago.
In 1994, support paid to homeowners through this tax relief outweighed their stamp duty and inheritance tax payments, which meant that homeowners received a collective £2.6 billion from the government.
House prices have tripled since then but inheritance tax and stamp duty thresholds fail to reflect this fact.
Last year, the chancellor increased the lower threshold at which stamp duty is paid – up to £120,000 from £60,000. However, government figures reveal that the price of an average house is currently £186,431.
The CML wants stamp duty and inheritance tax thresholds to be indexed in line with house price inflation.
"The failure to index thresholds for both inheritance tax and stamp duty means that the tax burden on homeowners has grown significantly in recent years," said Bob Pannell, head of research at the CML.
"This sits oddly with the government's stated goal of extending homeownershp to three-quarters of the population."To read more Property News, click here.
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