Government raked in £1.4bn in stamp duty before the March 30th deadline, as calls to remove the tax grow

UK homebuyers shelled out an extraordinary £1.4 billion in stamp duty in March 2025 as they scrambled to beat major tax threshold cuts, according to new HMRC figures.

This surge marked a 34% jump from February and a 63% increase compared to March 2024, highlighting how thousands rushed transactions to avoid steep hikes set for April.

The rise has led to increased calls from economists and experts to remove the tax claiming it inhibits the housing market.

Stamp duty surge as buyers race to beat April tax hike

UK homebuyers rushed to complete transactions before the April 1st deadline when tax thresholds reverted to pre-2022 levels.

The spike in activity was driven by the reversion of stamp duty thresholds. For home movers, the nil-rate band halved from £250,000 to £125,000, increasing the tax on an average-priced home in England from £2,082 to £4,582.

First-time buyers saw their relief threshold drop from £425,000 to £300,000, and the maximum property value eligible for relief reduced from £625,000 to £500,000.​

Tim Bannister, Rightmove's property expert, noted: “With the threshold for the nil rate... due to fall from £250,000 to £125,000, anyone purchasing a property over this amount could face paying up to £2,500 more in stamp duty land tax.”

Tim Bannister

Tim Bannister joined Rightmove in 2010, initially working in our lettings division before transitioning his focus to insights. As the current Director of Property Science, Tim leverages data, technology, and analytics to create distinctive insights that inform and guide property-related decision-making processes.

First-time buyers and Londoners hit hardest

The changes have significantly impacted first-time buyers, particularly in high-cost areas like London.

In London, fewer than one in ten homes will be free from a stamp duty charge to first-time buyers in April 2025 if the old thresholds return, compared to a quarter now.

Bannister added: “If the threshold is reduced to £300,000, only 37% of homes would remain stamp duty-free, a 21% reduction. This will particularly affect buyers in regions with higher property prices, such as London and the South East.” ​

Market outlook post-deadline

With the stamp duty thresholds now reverted, the property market may experience a slowdown as buyers adjust to the increased tax burden.

However, the long-term impact will depend on various factors, including interest rates, housing supply, and broader economic conditions.​

Buyers are advised to consult with financial advisors and conveyancing professionals to navigate the new tax landscape effectively.

Economists and experts call to reform

The rise in stamp duty tax has increased debate from economists and housing experts for removing stamp duty due to its inefficiency and negative impact on the property market.

The Institute for Fiscal Studies (IFS) describes it as "one of the worst designed and most damaging of all taxes," with Paul Johnson, director of the IFS, adding that it "helps to gum up the entire property market." This is supported by previous findings showed that one in four homebuyers have been pushed out the market.

Calls for reform include proposals for a land value tax, with Carol Wilcox, Secretary of the Labour Land Campaign, suggesting it could "lower land and house prices while providing substantial revenue for local authorities."

Senior economist Stuart Adam argues that SDLT "defies the most basic of economic principles" and should be abolished. Experts like Mark Bogard, Chief Executive of the Family Building Society, describe SDLT as "suffocating the housing market," while Professor Christine Whitehead, Emeritus Professor of Housing Economics, states that it is becoming an "increasingly heavy tax on housing transactions."

For now though stamp duty remains for those looking at selling or buying a house.