Investors paid less Stamp Duty on stocks and shares in 2023/24 than in the previous year, contributing to a total of £3.2bn, which reflects a 15% decrease, according to Hargreaves Lansdown.
Stamp Duty on residential property fell 27% from £11.72bn to £8.57bn.
Residential property sales dropped 18% to 872,000, and the number of purchases subject to the stamp duty surcharge for second properties fell 20% to 191,500.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: “Investors paid £3.2 billion in Stamp Duty on shares in 2023/24, which is a hefty charge, that flies in the face of the Government’s priority of encouraging more investment in the UK.
“This actually fell 15% during the year, but it’s unreasonable that investors have to pay anything at all in Stamp Duty, when most overseas share trades are Stamp Duty free.
“We’re out of line with the G7 and we need to level the playing field for UK plc.
Streeter added: “The current situation risks holding back vital funds for British based companies.
“It needs to be easier for people to save and invest for a better future in the UK which is why stamp duty on shares should be scrapped to boost the stock market and UK plc.”
Sarah Coles, head of personal finance at Hargreaves Lansdown, said: “Stamp Duty hasn’t quite proven the cash cow that has been milked in previous years.
“House prices and sales had a tough time during the year, thanks to massive hikes in mortgage rates at the end of 2022, which poured a bucket of icy water over the property market.
“The drop also owes something to the Stamp Duty holiday, which kicked off in September 2022 and runs until the end of March last year.
“The Stamp Duty threshold has been raised from £125,000 to £250,000.
Coles added: “The threshold for first-time buyers was also increased from £300,000 to £425,000 – and the maximum that a property can be worth and still benefit from this relief rose to £625,000 (up from £500,000).
“It cut tax bills for buyers by up to £2,500, while first-time buyers could save up to £11,250.
“However, Stamp Duty is likely to be back to being a nice little earner for the Government in the current tax year as sales have picked up.
“To make matters worse, at the end of March, the thresholds will revert, which will see a sizeable step up in the sums that property buyers need to part with.”
Coles said: “For property investors, that’s not the end of the tax misery, because since 31st October, the Stamp Duty surcharge for second and subsequent properties has risen from 3% to 5%, adding £4,000 to the cost of a typical purchase.
“It means property remains one of the least tax-efficient ways to invest.
“Unlike investors in stocks and shares, property investors can’t protect themselves from tax on income by using ISAs.”
