Middle market homebuyers could save thousands as minister suggests raising limit of five per cent band

Finance Secretary Derek Mackay has said he is open to reexamining the Land and Buildings Transaction Tax (LBTT) bands in a move that could save homebuyers thousands of pounds. Ministers had previously remained firm on LBTT bands but Mr Mackay has now said he is willing to increase the upper limit of the five per cent band to £500,000, which would relieve the tax burden on thousands of buyers in the middle of the property market. If the change goes ahead, it could create an average saving of £9,000 to those affected. Speaking to The Sunday Times, Mr Mackay said: “I’m not an ideologue on this issue. We want the tax to function well and if there’s a case that an amendment of the current bands could help stimulate the housing market in that range, and the revenue it raises, then I will consider it.” He added: “It’s early days. It’s normal to review policies.” Murdo Fraser, Scottish Conservative shadow finance secretary, said: “If Derek Mackay does perform a u-turn on LBTT rates it will be well overdue. “For months now experts have told us that the high rates set by the SNP were stifling the market and leading to a drop off in sales. “And with revenue projected to be down hundreds of millions of pounds from what was expected, it’s clear that the Finance Minister has made a huge error of judgment.”