Some of the UK’s largest residential landlords have warned that their industry has been put at risk by the use of punitive stamp duty taxes announced in the UK Budget.

The introduction of a 15 per cent stamp duty for houses worth more than £2 million and purchased through companies has been criticised as damaging to the UK’s ability to attract investment.

According to Sebastian Daly, Head of Real Estate Tax at international law firm Eversheds, the 15% charge is a punitive measure, introduced without consultation following media commentary about wealthy individuals avoiding Stamp Duty Land Tax (SDLT) on house purchases.

“The problem is that the new charge is a blunderbuss that also hits legitimate investors acquiring residential property in normal investment entities,” said Daly. “The new charge is proving a real issue for funds, commercial landlords and other property investors. Any acquisition involving high value residential property now needs to be handled with great care.

He added: “The 15% SDLT charge is part of a range of measures attacking high value residential property announced in this year’s UK Budget. The other measures, for possible introduction next year following consultation, include an ‘annual charge’ on high value residential property already held by non-natural persons, and the introduction of capital gains tax on the sale of such property non-resident persons.

“These measures would represent a fundamental change to the UK approach to taxation of real estate. The only positive point is that it is currently confined to residential property, but it is a spectre hanging over the whole property industry.”