publication . Preprint . Book . 2015

Transfer Taxes and Household Mobility: Distortion on the Housing or Labor Market?

Hilber, Christian A. L.; Lyytikainen, Teemu;
Open Access
  • Published: 01 Oct 2015
  • Country: United Kingdom
Abstract
We estimate the effect of the UK Stamp Duty Land Tax (SDLT) – a transfer tax on the purchase price of property or land – on different types of household mobility using micro data. Exploiting a discontinuity in the tax schedule, we isolate the impact of the tax from other determinants of mobility. We compare homeowners with self-assessed house values on either sides of a cut-off value where the tax rate jumps from 1 to 3 percent. We find that a higher SDLT has a strong negative impact on housing-related and short distance moves but does not adversely affect job-induced or long distance mobility. Overall, our results suggest that transfer taxes may mainly distort ...
Subjects
free text keywords: Transfer taxes, stamp duty, transaction costs, homeownership, household mobility, HG Finance, jel:D23, jel:H21, jel:H27, jel:J61, jel:R21, jel:R31, jel:R38
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