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18 January 2015, 06:00
New tax rates for property purchases are to be reviewed as part of the Budget process, the Scottish Government has confirmed.
Deputy First Minister and Finance Secretary John Swinney has faced pressure to revise the bands and rates of the Land and Buildings Transaction Tax set out in October's draft 2015-16 Budget.
The tax, which will replace stamp duty in Scotland from April, has been criticised for imposing higher rates on properties at the top end of the market.
The move follows an overhaul of the UK stamp duty system announced by Chancellor George Osborne in his Autumn Statement.
The rates are to be reconsidered in light of a deal being reached between the Scottish and UK governments on how much Scotland's block grant from the Treasury will be reduced to take account of receipts from newly devolved taxes - the LBTT and the Scottish Landfill Tax - flowing directly to Holyrood.
The Scottish Government had estimated that the two taxes would bring in around £558 million in 2015-16, but the final adjustment to the grant for the year has been set at £494 million.
The Scottish Conservatives, who attacked the LBTT as a "tax on aspiration'', have called on Mr Swinney to pass on the savings by reducing the rates.
The Finance Secretary said: "At the time of the UK Chancellor's Autumn Statement I said his imitation of my Scottish tax plans was the sincerest form of flattery. On the first occasion I've had to design a tax system for Scotland, the UK Government copied it instantaneously and applied it across the UK.
"At the time of my proposals - designed for the Scottish market, not London house prices - 90% of homebuyers would have been better or no worse off, and 5,000 homes would be taken out of taxation all together, helping those at the lower end of the market.
"The Chancellor's decision to introduce a new stamp duty system overnight, without warning and consultation, means that while 80% of homeowners continue to pay less tax or no tax at all under the Scottish system we now have the opportunity to review the rates and ensure they are right for Scotland.''
Mr Swinney will announce his conclusions to the Scottish Parliament on Wednesday when MSPs are due to debate the Scottish Budget Bill.
His initial plans raised the threshold for paying tax on a home from £125,000 under stamp duty to £135,000, with a rate of 2% on the proportion of the transaction between £135,000 and £250,000.
A further 10% rate would be applied to the proportion above £250,000 and up to £1 million, while 12% will be applied to the proportion above £1 million.
Under the UK stamp duty reforms, buyers pay 2% on the on the part of the property price up to £250,000, 5% on the part between £250,001 and £925,000, and 10% on the proportion between £925,001 and £1.5 million.
A rate of 12% will be paid on the part of the price above £1.5 million.