My dear wife has a subscription to Scottish Field, the country life magazine that has become a national institution. She reads it more than I do, but today I picked it up to study a piece by my old acquaintance Bill Jamieson. I thank him for it, and believe that it needs a wider audience.

His article points out an anomaly in the brand new Holyrood legislation which  replaces Stamp Duty in Scotland with a Land and Buildings Transaction Tax, which will make home owners who complete a purchase of a new main residence before selling the old one liable for an Additional Dwelling Supplement of 3% of the total purchase price.

In other words, you buy a new home, let’s say for £350,000. You will be liable for LBTT at 10%. That’s right, you will pay Revenue Scotland £35,000 for the privilege of making that purchase. Then, if your old place doesn’t sell before your completion date, you will be liable for a further £10,500 on your second home that isn’t.

I’ve picked that figure to catch the eye, I admit. (Mind you, try and buy a Cala house for under £350,000.) LBTT will be levied on a sliding scale; if the purchase price is between £145,000 and £250,000 the rate os 2%. Between £250,000 and £325,000 it’s 5%. Whatever the level, it’s a tax on people’s aspirations and it doesn’t sit well with me.

When Eileen told me about this, my first reaction was to assume that she had misread it. But no, it’s for real. This is what Revenue Scotland says about it on its website.

“Q: I am buying my next house which will be my main residence. I am selling my existing main residence but the contract for sale will not go through until after my new purchase is completed. As I am selling one property and buying another, will the Additional Dwelling Supplement apply?

A: Yes. When you purchase your new house, because you will not have sold your existing main residence, you will own two houses. You will therefore have to pay the Additional Dwelling Supplement on the purchase of your next house.

However, on 2 March 2016, the Scottish Parliament’s Finance Committee agreed to amend the Bill at stage 2 of the Bill process to allow for the situation where the buyer purchases their new main residence before they sell their old one. In such a situation, if the sale of the previous main residence takes place before the tax return for the purchase of the next main residence is made, no Additional Dwelling Supplement is due.

If you have already submitted a return for the purchase transaction, you will, be eligible to make a claim for the repayment of the Additional Dwelling Supplement you paid once your previous house is sold, provided that completion takes place within 18 months of the purchase of your next home. Example 2.05 explains how to claim a repayment of the Additional Dwelling Supplement.”

I have no plans to move, or to buy an additional home in Scotland; if I had, I’d be shelving them.

At a time when the Scottish housing market needs to be stimulated, the party of which I am a member seems to be doing its best to cut its throat. Leaving aside the morality of a tax on home ownership, would it not have been more sensible administratively, and less damaging to the individuals caught in this nasty little trap to make the tax fall due 18 months after the completion date on the purchase transaction?

PS

This too: similar taxes are due on property purchases in Spain. As a result what happens in practice, the parties agree on a declared price for housing transaction, and an actual price. When the two come together in the Notario’s office to complete the purchase, said public official will leave the room during  the process, and the balance of the price will change hands, in cash.

How long will it be before the passage of brown envelopes containing £50,000 in cash becomes commonplace in Scotland?