Chancellor Gordon Brown, while claiming credit for the buoyant state of the UK economy, has taken yet another stealthy swipe out of the pockets of hardworking British homeowners in the Budget statement yesterday.

Stamp duty was stealthily left unchanged. As well as putting more pressure on those trying to enter the bottom rungs of the housing market, by simple inaction Brown is also effectively increasing the number of homebuyers who are now liable for this tax. House price inflation ensures that more people fall into the stamp duty bracket every month. Figures from the Inland Revenue reveal that £3.59billion was raised from stamp duty in 2003/2004, up 330% compared to £830million in 1999/2000.

Ray Boulger of mortgage brokers Charcol said: “While it is good news that stamp duty has not been increased, it is disappointing that it continues to be an unfair tax.”

“Since 1993, when the starting threshold for stamp duty was increased from £30,000 to £60,000, house prices have risen by 167% but the threshold has stayed the same.”

“This has become one of the Chancellor's biggest stealth taxes and is now hitting hard many first-time buyers and other homeowners that it was never targeted at.”

Back from the future

In another slight of hand Brown even managed to take money from our grandchildren – how’s that for stealthy borrowing tactics to pay for today’s overspending? And that’s money he won’t have to pay back either.

Ignoring industry calls for a sensible increase in inheritance tax, or at the very least exclusion of the main residence, the Chancellor has niggardly increased the limit by just 3%. It’s a joke - some properties rose more than this in a month in February. And at a tax rate of 40% that’s a massive and blatant stealing of our hard-saved-for legacy to our loved ones. This tax was only intended to be for the wealthy but as today’s properties continue to rise, everyday people fall into the tax band in increasingly large numbers.

Ray Boulger again: "Today's increase of 3% to £263,000 is only a gesture. It falls far short of what we feel is needed and means that millions of homeowners are still being thrust over the threshold and face a 40% tax bill simply for owning their own homes."

"This news is worse for Londoners. Four years ago the average London property cost £157,801, compared to £260,658 now, a rise of 65%. However the IHT threshold has risen by only 14% over this period (from £231,000 to £263,000)."

No control on council tax

But the biggest stealth tax of all was cunningly avoided by the Chancellor. Despite massive protests and pensioners threatening to go to jail rather than pay recent exorbitant council tax increases, Brown managed to hardly mention council tax at all.

Brown did manage to give an extra £100 a year to households with pensioners over 70 "to help with council tax".
“The government believes it is right to help older pensioner households with their council tax,” said the Chancellor. What a joke. Who on earth did he think he was kidding? Many pensioners are already paying for council tax increases out of savings because their income, although taxable mind you, is not sufficient to pay the massive increases seen over the last few years. Almost all are on fixed or at best, slightly indexed incomes facing double-digit rises in council taxes year-on-year.

But it’s not just pensioners who loose out – we all pay these hefty increases – another stealth tax. And one that hits hardest at middle England homeowners who have managed to scrape together enough to build a comfortable home but don’t have a large enough income to swamp the effects of double-digit taxation rises.

Vince Cable MP, Liberal Democrat Shadow Chancellor, responding to the Budget, said:
"This Budget has a hole right at its heart as the Chancellor has postponed the tough decisions until after the next election.”

"The unfairness of the taxation system has been left untouched, especially the unfairest tax of all, Council Tax.”