From April 1, 2018, Wales will make a number of changes to property taxes in devolution rules that allow the nation to charge different taxes to England.
According to a January 2018 Tax-News.com article, Wales will have the highest threshold for the starting values of property tax in the UK. Property tax will be charged on property costing £150,000 or more, which is an increase from the present £125,000. The property tax replaces stamp duty and is charged at variable rates depending on the property value.
Properties worth from £150,000 to £250,00 will be charged 2.5%, over £250,00 and under £400,000 the rate is 5.%, then up to £750,000 is 7.5%, and up to £1.5m is 10%. All property worth more than £1.5m will be charged at 12%.
Commercial property taxes will be reduced. All commercial property purchases up to the value of £1.1m will either be charged no tax or less tax then the existing stamp duty rates. This could make commercial property more attractive to investors. Commercial mortgages are available at low interest rates to fund property purchases in Wales.
Mark Drakeford, the Welsh Finance Secretary, said that this “significant milestone” can go some way to making Wales into a fairer country while also boosting its economy.
The changes in property taxes are part of the Welsh National Assembly’s policy to be more responsible for their own funding and have powers to shape the Welsh economy. The economy has also been helped by more government funding in Wales.