In a significant policy reversal that acknowledges economic realities, Chancellor Rachel Reeves has abolished the controversial stamp duty on share purchases. The move comes as a direct response to mounting pressure from Britain's financial sector and the stark warning from pharmaceutical giant AstraZeneca.
The AstraZeneca Catalyst
The decisive moment arrived when AstraZeneca's leadership made clear their London listing was under serious threat. The 0.5% tax on share purchases had become a major competitive disadvantage for the UK market, pushing one of Britain's flagship companies toward considering foreign listings.
"Sometimes in government, you have to recognise reality," sources close to the Treasury revealed. The previous government's refusal to address this issue had created a dangerous standoff that threatened to damage London's status as a global financial centre.
What This Means for UK Markets
The abolition of share stamp duty represents a major victory for financial competitiveness. This decisive action:
- Removes a significant barrier to investment in UK companies
- Helps retain major listings like AstraZeneca in London
- Makes UK equities more attractive to international investors
- Signals a pragmatic approach to economic policymaking
A Pragmatic Chancellor Changes Course
Rachel Reeves' decision marks a notable departure from previous positions. While the stamp duty on property transactions remains untouched, the recognition that share transaction taxes were damaging Britain's financial ecosystem proved decisive.
The Treasury now acknowledges what City figures have argued for years: this tax was driving business away from London to more competitive markets like New York, where no such transaction tax exists.
This policy U-turn demonstrates a chancellor willing to adapt to economic evidence rather than sticking rigidly to ideological positions. The message to international investors is clear: Britain is open for business and ready to compete globally.
