Stamp duty receipts down almost £2bn

THE GROWING hole in the nation's finances was underlined today when new figures showed stamp duty receipts had collapsed by nearly £2billion.

The property market slump meant that the Treasury's income from the house sales tax for July to September fell from £4billion last year to just £2.2billion this year.

The figures from HM Revenue and Customs suggest that receipts for the whole of 2008/9 will come in at about £9billion - some £4billion lower than the £13.4billion forecast by the Chancellor. Just £4.7billion was raised in the first six months.

With Alistair Darling's pre-Budget report just three days away, the statistics expose why he will have to increase borrowing. Inheritance tax receipts were also down on last year, from £1billion to £787million.

Corporation and income taxes held up, but the biggest lifeline for the Treasury came from petroleum tax revenue, which soared to a record £1.3billion for the third quarter from £455million for the same period last year.

But the income from the oil price hike will be short-lived and nowhere near enough to make up the shortfall.

The number of residential property transactions in the UK more than halved, from 407,000 in the third quarter of last year to 189,000 for the same period this year.

Transactions are set to total one million for 2008 - way down on the 1.8million for 2006 and 2007.