Getting rid of SDRT would pay for itself over time because other receipts would rise, abolitionists say
Rachel Reeves is looking for taxes to raise, rather than ones to abolish. Never mind: here is a tax that ought to be scrapped by a government that calls itself pro-growth, pro-business and pro-investment, which was the pitch at this week’s big summit. What’s more, the enticing claim from abolitionists is that getting rid of the tax could – with a few qualifications – pay for itself over time because other Treasury receipts would rise.
The tax is stamp duty on shares – or, in full, stamp duty reserve tax, or SDRT. It is the 0.5% levy on purchases of shares in UK companies that brought £3.8bn into the Treasury in the 2022-23 tax year. Ireland has a higher rate, 1%, but nobody else does. The US, China and Germany don’t impose any equivalent tax at all. So the claim that the UK is at a competitive disadvantage in attracting listings and liquidity to its stock market looks solid. At a moment of panic over the sleepy state of London, especially at the bottom half of the stock market, that point ought to resonate.
Continue reading...
