There has been mounting confusion in relation to the possible impact of a mooted increase in stamp duty rates expected to be announced this afternoon, Tuesday, October 8, as part of Budget 2020.
The expected increase on commercial land – anticipated to rise from 6% to 7.5% – has raised many questions regarding how farmers in general will be impacted.
In 2017, the Government’s decision to increase stamp duty from 2% up to 6% raised fears that it would not only have a negative effect on the land market, but on the entire agricultural sector.
However, two stamp duty reliefs were later introduced by the Government to mitigate negative impacts on some farmers.
Following on from this, in last year’s budget, Section 46 of the Finance Bill 2018 provided for the extension of the young trained farmer stamp duty relief for a further three years – up until the end of 2021.
This relief provides for a full exemption on stamp duty on transfers of farmland to certain young trained farmers.
This exemption from stamp duty is designed to encourage the transfer of farmland to a new generation of farmers with relevant qualifications. The transfer may be by way of gift or sale.
However, this deadline was not extended in last year’s budget – how today’s announcement changes that remains to be seen.
Stay tuned to AgriLand for all the latest developments on Budget 2020.