The new land transaction tax (LTT) which will replace the UK stamp duty land tax (SDLT) in Wales will be launched on 1 April 2018. The LTT legislation received Royal Assent on 24 May and is the first Act of this Assembly term.
The LTT marks the first new Welsh tax in almost 800 years. The legislation is broadly based on the existing SDLT legislation, however the final announcements on tax rates and bands will not be made until 1 October 2017 and the regulations will be laid after the UK Autumn Budget. The new Act also put in place a new general anti-avoidance rule for devolved Welsh taxes to stop any tax advantages arising from artificial tax avoidance arrangements.
This is similar to the Scottish Land and Buildings Transaction Tax (SLBTT) which became effective in Scotland on 1 April 2015. The SLBTT operates in a similar way to SDLT but there are some key differences.
Welcoming the Bill receiving Royal Assent the Finance Secretary, Professor Drakeford said:
‘This Act will enable us to introduce a new made-in-Wales tax on land transactions to replace stamp duty land tax, ensuring public services continue to benefit from the revenues raised by this important tax. I would like to thank all those who have helped us shape this Act and look forward to continuing to work with them as it is implemented.’
The Welsh Revenue Authority (WRA) will be in charge of collecting and managing devolved taxes in Wales initially expected to comprise the LTT and the Landfill Disposals Tax which is currently being considered by the National Assembly.