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

Hilber, Christian A. L. and Lyytikainen, Teemu (2017) Transfer taxes and household mobility: distortion on the housing or labor market? SERC Discussion Papers (SERCDP0216). Spatial Economics Research Centre, London School of Economics and Political Science, 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. Overall, 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: © 2017 The Authors
Divisions: Geography & Environment
Spatial Economics Research Centre
Centre for Economic Performance
Subjects: H Social Sciences > HG Finance
Sets: Departments > Geography and Environment
Research centres and groups > Spatial Economics Research Centre
Research centres and groups > Centre for Economic Performance (CEP)
Date Deposited: 24 Jul 2017 08:22
Last Modified: 20 Jun 2020 00:50
Funders: Economic and Social Research Council
URI: http://eprints.lse.ac.uk/id/eprint/83639

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