MS, Cabinet Secretary for
Finance and Welsh Language: Today I have laid the draft Land
Transaction Tax (Modification of Relief for Acquisitions
Involving Multiple Dwellings) (Wales) Regulations 2025 before the
Senedd. Subject to Senedd approval, the Regulations will amend
some of the rules governing land transaction tax (LTT)
reliefs.
Explanatory Memorandum to The
Land Transaction Tax (Modification of Relief for Acquisitions
Involving Multiple Dwellings) (Wales) Regulations 2025
The Land Transaction Tax
(Modification of Relief for Acquisitions Involving Multiple
Dwellings) (Wales) Regulations 2025
The new regulations will amend rules governing the combined use
of LTT multiple-dwellings relief (MDR) and the subsidiary
dwelling exception (SDE). Until now, taxpayers have been able to
choose to make a claim to MDR in relation to all
multiple-dwelling transactions. The new regulations will
discontinue the possibility of claiming MDR in relation to
transactions which are subject to the main residential rates
because of the application of the SDE.
These amendments are in line with our key tax principles
underpinning our devolved taxes, to raise revenue to fund public
services as fairly as possible, deliver our policy objectives, be
clear, stable and simple, be developed through collaboration and
involvement and contribute to the Well Being of Future
Generations Act goal of creating a more equal Wales.
In setting out the intended rule change, this statement provides
an update on the Welsh Government's response to the public
consultation on LTT reliefs which was conducted between 8 April
and 19 May 2024. An initial response was published on 17 July
2024.
As I have set out in the Explanatory Memorandum published today
to accompany the draft statutory instrument, the rule changes
proposed today are estimated to increase LTT revenues by between
£1 million and £2 million per year. This will partly offset the
cost of providing MDR (on average around £10million each year
since 2018). Further work will be carried out to consider MDR
relief within the LTT regime over the coming year, reflecting
on the benefits of MDR as a policy lever alongside its
impact on LTT revenues.
