7. Will the Minister provide an update on any proposed changes to the land transaction tax in Wales? OQ57755

We're currently consulting on possible local variation of land transaction tax rates for second homes, and that consultation closes on 28 March.

Diolch, Minister. Taxes on properties purchased in Wales are some of the highest levied in the United Kingdom. The average house in the town of Brecon within my constituency is £261,000. Based on this price, a first-time buyer, who has struggled to even get the deposit, will be paying a tax to the Welsh Government of £3,000. This compares to a figure of £2,050 in Scotland, nothing in Northern Ireland and nothing in England. Minister, can you explain why your taxation policy here is making it harder for those young people in Wales to own their own homes? And in your role as finance Minister, will you at least commit to ring-fencing some of that money collected from land transaction tax to be used to build affordable homes in Wales to assist the housing crisis?

I hope the Member sees some of the irony there in the way in which the Conservatives have opposed our efforts to take action on the second homes situation, when, as the Member says, people are struggling just to buy one, and, for many, it will always be unattainable. So, this is one the reasons why we are taking action on the second homes issue. But, in respect of our starting rate for land transaction tax, that starts at £180,000, so our main rate starting threshold is substantially higher than any other part of the UK. And in the year to date, this has meant that the majority of residential transactions in Wales are below that threshold, and this isn't the case for other countries in the UK.

Most first-time buyers in Wales still benefit from paying no tax at all, but with our approach, other hard-pressed people can also benefit from paying no tax. Because, actually, the average house price in Wales is £204,835, but the average price for a first-time buyer is £175,908. So, you will clearly see that the average first-time buyer is able to purchase that house without paying any tax at all.