Hansard

This provisional affirmative order provides for the temporary changes to the LBTT bands and rates that I announced in the chamber on 9 July, when responding to the chancellor’s economic update. For transactions with an effective date of between 15 July 2020 and 31 March 2021, the starting rate for residential LBTT is increased from £145,000 to £250,000.

Members will be aware that this is the first time that a change to rates and bands has been made outside the Scottish budget process. Our view was that it was necessary to act, and to act quickly, given the immediately destabilising impact of the UK Chancellor of the Exchequer’s 8 July SDLT announcement on Scotland’s housing market—an announcement of which we were given no advance notice aside from the media speculation. No change to LBTT has been delivered as quickly as this in order to deal with the negative impacts, and all the relevant policy, analytical, legal, operational and other tasks that are required to deliver the change were completed within five working days of the initial announcement.

The Green Party has, understandably, raised concerns this afternoon about the impact on house prices and costs that home buyers might face. The Scottish Fiscal Commission’s costing for the measure does consider that there will be an impact, but it estimates that such an impact is likely to be “small”.

However, I recognise that we need to provide significant support to those who have been hardest hit by the pandemic. That is why, on the same day, I announced £100 million for skills and jobs, including the job guarantee scheme, to ensure that young people, in particular, have work or training opportunities.

On Patrick Harvie’s point, we have considered and implemented a number of other changes to provide the support that people in Scotland need quite desperately right now. We know that the latest LBTT statistics show that transactions in the first four months of the year are down by almost 60 per cent compared with the same four months last year; therefore, the measure is providing some help to home buyers and companies throughout the housing market at a difficult time. We have also announced other initiatives: we have put in place support through the first home fund and other shared equity home ownership schemes.

Throughout the pandemic, we have had to balance our resources to support economic recovery but also, most critically, to help those hardest hit during the pandemic. The LBTT measure is just one form of our support, but our support is there, whether it is for businesses or for communities, to ensure that we get through the crisis and support economic recovery.