A bad-news Budget?

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The Independent Online
The snug bar at the Fount of All Knowledge is awash with gossip and speculation - none of it particularly encouraging. Our collective cage has been rattled by the prospect of this week's Budget. The source of our unease is the measures the Chancellor may introduce which will affect the property market.

Mr Brown lives in the equivalent of a council house and as such is unlikely to be taking a personal interest in the property market for the next year or 10. He is also a natural takeaway chancellor. Unfortunately he is one who is restricted in his targets. His contract with the nation not to ratchet up income tax leaves Mr Brown as something of a chained chancellor. A chained chancellor is a dangerous chancellor who is prone to cast his revenue raising net more widely in the direction of areas such as ... the property market.

This is the view of Conan the Accountant who has wheedled his way into our drinking clique with his tax tips and extreme views on the Chancellor.

"What is the difference between a lounge suit and a dinner suit?" Conan asked us last week, ahead of one of his pre-Budget seminars. "About 200 seats," he roared in a thinly veiled reference to the Chancellor's preference for less formal evening attire.

"It wouldn't surprise me if he delivered the Budget in his underpants," Conan added. "And supped throughout his speech from a strawberry-flavoured slush puppy. The man has no respect for tradition."

"From Hush Puppy to slush puppy," I observed wryly, but Conan was in full flow.

"Believe me, a chancellor of tradition would not be contemplating an assault on the property-owning democracy of this country," Conan ranted. "These are not the politics of socialism, they are the politics of envy."

At that point Pedro arrived with a heavily sedated half-pint of shandy which he thrust under Conan's nose.

"If he increases stamp duty it will be the ruination of the property market," Conan muttered as he drifted off into a coma.

"I did stamp duty once," piped up Emma, official grumpy spice and partner to Pedro.

"I don't think you do stamp duty, I think you pay stamp duty," Pedro gently corrected.

"No," Emma insisted. "When I worked at that solicitors we took it in turs to do stamp duty. You know, when you cut off all the pretty coloured ones and put them in an envelope for the senior partner's grandson." We nodded our understanding.

"But what about the stamp duty you have to pay," I ventured "Is he going to increase it?"

This was the cue for Kevin our stamp duty specialist to treat us to a dissertation on the European comparisons for land- and property-related taxes.

"On that basis it can be argued that the rate should be raised from 1 per cent to 7 per cent," Kevin concluded with a flourish.

We all woke with a start. There was much groaning all round apart from Emma's direction where there was unrestrained glee.

"Pedro, we musty buy the loft, " she insisted. "If he is going to increase the rate then we must buy now."

"That loft will set us back pounds 300,000," Pedro grimaced.

"Yes, but the more we spend the more we save."

This sounded like the cue for an argument, so the rest of us busied ourselves with a discussion on the real implications of an increase in stamp duty on property transactions. Yes, it would cost us more to buy in hard cash terms but would it have a compensating effect by driving down prices?

For the time being, that is for Mr Brown to know and for rest of us to find out.

I for one will be tuned in and turned on come Wednesday afternoon. Normally I watch the New Yogi Bear show. Let us hope that Mr Brown is smarter than the average bear of the property market.

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