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Transfer taxes and household mobility: distortion on the housing or labour market

Hilber, Christian A. L. and Lyytikainen, Teemu (2015) Transfer taxes and household mobility: distortion on the housing or labour market. SERC discussion papers (SERCDP0187). Spatial Economics Research Centre, London, UK.

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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. our results suggest that transfer taxes may mainly distort housing rather than labor markets.

Item Type: Monograph (Discussion Paper)
Official URL: http://www.spatialeconomics.ac.uk/
Additional Information: © 2015 The Authors
Divisions: Spatial Economics Research Centre
Subjects: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HD Industries. Land use. Labor
H Social Sciences > HJ Public Finance
JEL classification: D - Microeconomics > D2 - Production and Organizations > D23 - Organizational Behavior; Transaction Costs; Property Rights
H - Public Economics > H2 - Taxation, Subsidies, and Revenue > H21 - Efficiency; Optimal Taxation
H - Public Economics > H2 - Taxation, Subsidies, and Revenue > H27 - Other Sources of Revenue
J - Labor and Demographic Economics > J6 - Mobility, Unemployment, and Vacancies > J61 - Geographic Labor Mobility; Immigrant Workers
R - Urban, Rural, and Regional Economics > R2 - Household Analysis > R21 - Housing Demand
R - Urban, Rural, and Regional Economics > R3 - Production Analysis and Firm Location > R31 - Housing Supply and Markets
R - Urban, Rural, and Regional Economics > R3 - Production Analysis and Firm Location > R38 - Government Policies; Regulatory Policies
Sets: Research centres and groups > Spatial Economics Research Centre
Collections > Economists Online
Date Deposited: 15 Jan 2016 13:49
Last Modified: 05 Jun 2019 23:26
Funders: Economic and Social Research Council, Academy of Finland
URI: http://eprints.lse.ac.uk/id/eprint/65022

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