Labour is outraged by the Chancellor’s announcement to implement a stamp tax duty holiday cut, and calls it 'a huge bung to second homeowners and landlords'.

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The party has sent an open letter to Robert Jenrick, the government’s housing minister, stating that the reduction in tax is worth more than £1.3bn to investors.

The party argues that the £1.3bn should instead be given to local councils in light of the coronavirus impact.

In the summer budget the Chancellor raised the threshold for when stamp duty comes into force from £150,000 up to £500,000 which will be continued until March 31st 2021.

Landlords and second home buyers will still have to pay the 3% stamp duty surcharge.

Labour claims that during 2019/2020 over a third of homes that were bought as second homes or BTL investments.

Shadow housing minister Thangam Debbonaire said: “It is unacceptable that the chancellor tried to sneak out this huge bung to second homeowners and landlords while millions of people are desperate for support.

“He should be targeting support to those who need it, not helping people invest in buy-to-let properties and holiday homes.

“An unnecessary subsidy for second home-owners will only worsen the housing crisis by reducing the supply of homes overall.

“We need a credible plan from Tory ministers to build the homes our country needs and get people on to the housing ladder. We didn’t see that this week.”

A Treasury spokesperson said: “The housing market has been hit hard by the outbreak with 175,000 missing sales – so we are doing everything we can to get the country moving again.

“Our cut in stamp duty will help drive growth and support jobs across the house building and property sectors.

“Those buying second homes or buy-to-let properties will continue to pay an additional three per cent on top of the standard SDLT rates.”

Richard Merrick of PIMS, said:” When will politicians understand that because of the pandemic many people have been made redundant, or are having to live on reduced funds.

“Home ownership has been on a downward trend from more than twenty years ago, as successive governments have failed to provide sufficient housing to cope with population growth.

“The PRS grew because of continual failing housing policy inadequacies.”