Ahead of the 'mini-budget' on Friday 23 September 2022, news that prime minister Liz Truss has given the go ahead for a cut in stamp duty to boost the UK economy, and that more will be done to help companies trying to cope with soaring fuels bills, has been welcomed by businesses in Gloucestershire.
In his first public address as the nation’s chancellor, Kwasi Kwarteng is expected to reveal the full detail of the new government's economic battle plan to fend off rising inflation and the growing cost of living crisis.
In a pre-statement leak, it's reported Kwarteng and Truss believe a cut in stamp duty, the tax levied on the purchases of houses and flats, will stimulate growth in the property market and drive other spending.
Laurie Duckworth, sales manager at the Gloucester Docks branch of county estate agents Naylor Powell, said: ‘If this happens we think it is positive. It will help keep the market going. It has been pretty buoyant, but this should definitely have an impact.
‘During the height of the Covid-19 pandemic, when stamp duty was held it did drive the market forward. And if this also helps make more homes affordable that would also be a positive.
‘Buying a home is one of the biggest spends for most people during their lifetime and it helps drive some of the other biggest purchases people make too.’
Enzo Mora, founder and chief executive at Gloucestershire's The Mortgage Brain, said: 'If the new government increases the current stamp duty threshold of exemption from £300,000 for first-time buyers, this could give these potential borrowers renewed confidence to enter the market as interest rate rises have put a damper on some plans.
'It all rests on supply, however, which is still constrained and putting upward pressure on house prices and affordability.
'According to Rightmove 60 per cent of properties currently on the market fall in the £250,001 to £925,000 price bracket, so if there were further stamp duty savings announced in this band across buyers, second and third steppers could be incentivised to sell and thus increase supply which would go some way to prevent house prices spiralling.
'More house moves will bring wider economic benefits.'
It was not the only significant pre-fiscal statement announcement. Business West, which represents the region’s chambers of trade, welcomed news of the Energy Bill Relief Scheme for businesses.
The new government scheme will see energy prices cut for non-domestic energy customers such as businesses, charities and public sector organisations in an effort to protect them from rising energy costs.
Claire Ralph, policy manager at Business West, said the scheme would provide an element of certainty, for a limited time and offer vital breathing space through the winter months. But she warned more was needed to give businesses the ability to plan longer term.
Sam Holliday, the Federation of Small Businesses' development manager for Gloucestershire, Bristol and Bath, said: 'It is good to see the government has listened to business in addressing the huge utility bills crisis that has threatened to derail the small business led post-Covid-19 recovery in the region, but we hope this isn’t the end of the story.'
