Capital gains tax 'to rise to 25%'

Posted: 24 Feb 2010 10:59:29 GMT

Capital gains tax (CGT) is likely to rise to 25 per cent in the forthcoming Budget, according to one investment expert.

Richard Bowser, editor at Property Investment News, states that it is important for homeowners to remember that it wasn't so long ago that CGT for investment properties stood at 40 per cent.

"It is just a fact of life that we are all going to have to accept that we are going to have to pay more tax," he says.

But Mr Bowser adds that he thinks this tax hike is unlikely to have an effect on the housing market as selling property is not an instant process.

His comments come in response to a recent report from Cluttons, which found that the potential rise in CGT has led to an increasing number of people placing their second home on the market in a bid to sell the property before the legislation takes hold.

According to HM Revenue and Customs, the current CGT rate stands at 18 per cent.

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