KATE Forbes slashed taxes for home-buyers yesterday, as she set out the Scottish Government’s response to Rishi Sunak’s summer statement.

The Scottish Finance Secretary’s decision to raise the threshold for Land and Buildings Transaction Tax (LBTT) to £250,000 followed the Chancellor’s scrapping of stamp duty on sales of properties under £500,000 in England.

The change will mean about eight in 10 house-buyers in Scotland will not pay LBTT.

Forbes said the change in Scotland would allow her to also make an additional £50 million available to help first-time buyers.

However, the minister admitted the move may cause some disruption in the housing market due to the time it takes to change LBTT. That means it’s likely few buyers will complete their purchase just now when they can save thousands by waiting just a little bit longer.

The minister told MSPs: “I’ve listened to calls for me to raise the starting threshold to LBTT to help stimulate housing market activity and the economy.

“It’s important though that any change made in Scotland is focused directly on the particular needs of the Scottish economy.

“And so today, I can announce that I will increase the starting threshold for residential LBTT from £145,000 to £250,000.

“Because of the time required to prepare legislation, and for Revenue Scotland to be ready to collect and manage the tax, the change will not come into force immediately, but I’ll work to enable this to be introduced as soon as possible.”

When Tory MSP Donald Cameron said this delay would cause disruption in the market, Forbes pointed out that she’d had no advance warning of Sunak’s stamp duty promise and was moving as fast as the legislation allowed. She said: “The alternative would have been to say nothing and to create even more uncertainty in the market.

“So, I’ve chosen to give that clarity, understanding fully the limits on the legislative process. And the challenge for Revenue Scotland.”

On Wednesday, the Chancellor announced a series of measures aimed at reviving the UK economy as the country eases out of coronavirus lockdown restrictions.

Forbes welcomed some of the measures – such as a reduction in VAT for the tourism and hospitality sector – but she also claimed the UK Government had failed to listen to pleas from Holyrood ministers for further fiscal powers.

She said that means her government’s response to coronavirus is still “heavily dependent” on what is done at Westminster.

Forbes argued: “The fiscal powers we are seeking would enable the Scottish Government to respond to Covid-19 more effectively and reboot our economy.

“They are relatively limited powers, I am still not quite sure why we are debating it.

“But they would ease some of the immense pressures on our budget and give us more tools to kick-start our recovery.”