 First Minister on the fiscal framework. We are now moving to the next item of business, which is a debate on motion number 15694 in the name of John Swinney on the Land and Buildings Transaction Tax Amendment Scotland Bill. Members should leave the chamber, should do so quickly and quietly, and those who want to take part in the debate should press a request-to-speak button now, and I'll give just a few seconds for the room to clear. I'm pleased to open the debate on the general principles of the Land and Buildings Transaction Tax Amendment Scotland Bill, which I introduced to Parliament on the 27th of January this year. I'd like to begin by thanking all those who gave evidence, written and oral to the Finance Committee, and those such as the Law Society of Scotland and Revenue Scotland, who have given and are continuing to give freely of their time to work collaboratively with the bill team to resolve some of the more thorny technical matters and to ensure, as far as practical, a smooth implementation of this bill. I'm grateful to the convener and members of the Finance Committee for their scrutiny of the bill at stage 1, and particularly for committee members' co-operation in working to an expedited timetable for this bill. I welcome the committee's support for the general principles of the bill. In light of the expedited bill timetable, I wrote yesterday to the convener of the Finance Committee, setting out the Scottish Government's response to the committee's stage 1 report on this bill, and I hope that it was helpful to members to have that response in advance of the debate today. The Land and Buildings Transaction Tax Amendment Scotland bill introduces a 3 per cent land and buildings transaction tax supplement payable on the purchase of additional dwellings, such as buy to let or second homes. Subject to parliamentary approval, that means that, from 1 April 2016, anyone buying a residential property in Scotland of £40,000 and above, who already owns a residential property here or anywhere in the world, will pay an additional 3 per cent land and buildings transaction tax on the whole purchase price of the property unless they are simply replacing their existing main residence. The Scottish Government wishes to maximise the opportunities for first-time buyers to get a foot on the property ladder in Scotland. The bill will counteract the potential distortive effect of a new stamp duty land tax, higher rate of tax being brought in in the rest of the United Kingdom from 1 April 2016. Without a land and buildings transaction tax supplement, it is likely that the stamp duty land tax, higher rate of tax, would make it relatively more attractive for investors to buy up homes in Scotland, particularly at the lower end of the market, thus increasing the competition for first-time buyers and the danger of undermining the policy objectives of the Scottish Government in that respect. The motivation of the Government has been clearly expressed to deal with circumstances that we believe are made more likely by the tax changes that are made in the rest of the United Kingdom. I am aware from the evidence presented to the finance committee during their stage 1 scrutiny of the bill that some stakeholders have expressed disappointment at the 3 per cent supplement applying to the whole purchase price and view that as a return to a form of slab tax, which prevailed in the former stamp duty land tax that existed in Scotland. As I have indicated already, the Scottish Government wishes to do all that it can to empower first-time buyers to purchase their first home. The rationale for applying the supplement to the whole purchase price is that it will impose a greater tax charge on purchases of additional property at lower value transactions. That is where the demand for properties for investment purchases or holiday homes could make it difficult for first-time buyers to enter the market to purchase a main residence. For example, someone buying a property as their main residence for £100,000 will not pay any land and buildings transaction tax, but someone buying the same property for an investment or a second home will pay £3,000. As I indicated in my draft budget statement last December, the supplement is estimated to raise between £17 million and £29 million in 2016-17, after taking account of behavioural effects, including any impact on underlying LBT revenues. The Scottish Fiscal Commission has endorsed the estimate as reasonable, recognising the uncertainties posed by the lack of Scottish data on those types of transactions. In estimating the revenues—I discussed those issues with the finance committee in our earlier discussions on that point—the Government has erd on the side of caution in estimating the volume of revenues that could arise from the tax change that is being made, given the fact that there could be behavioural implications of the application of this particular tax charge. The Scottish Government considers the housing system should cater for a variety of needs and demands across all tenures. I recognise the need to balance support for home ownership and first-time buyers without discouraging significant and beneficial investment in residential property for rent. The Scottish Government has been supporting the purpose-built private rented sector since 2013, funding both the building of the rented sector study and a dedicated private rented sector champion, tasked with ensuring that action is taken to boost the supply of high-quality private rented sector homes at scale. After reviewing and reflecting on the stage 1 evidence, I am pleased to say that the Scottish Government concurs with the finance committee's stage 1 report recommendation that provision should be made within the bill for a relief from land and buildings transaction tax supplement for buyers purchasing six or more residential properties in one transaction. The Scottish Government intends to bring forward a stage 2 amendment to give effect to this particular issue. On the issue of reliefs in general, I note from reviewing the stage 1 evidence that there are suggestions for a variety of reliefs from the supplement. The Scottish Government recognises that the housing market changes over time and where practical and affordable wishes to do what it can to create sound sustainable market conditions. However, as with the land and buildings transaction tax system, I am firmly of the view that a period of time will be required to enable the land and buildings transaction tax supplement to become embedded and for sufficient financial and statistical data to be collected to enable informed policy decisions to be made in the future. The position on reliefs with particular reference to the land and buildings transaction tax supplement will be kept under review as part of the on-going process of devolved tax planning and management. However, I hope that the specific relief that I have set out in relation to the bulk purchase of properties gives some further clarity to the marketplace and can enable commitments to be made with the assurance that I have given. When I gave oral evidence before the finance committee, I did not close the door on implementing a grace period for transactions. I have carefully reviewed the stage 1 evidence and considered further helpful input from the Law Society of Scotland and Revenue Scotland. I am not convinced of the strength of that evidence as yet, but I do not want to entirely close the door on implementing a grace period. The approach that I have elected to take here is to ask Revenue Scotland to monitor the position between the LBTT supplement provisions coming into force on 30 October 2016. The data collected will enable the Scottish Government to take an informed view as to the need or otherwise of a grace period and what a grace period should be. Existing provisions in the legislation enable individuals to essentially claw back charges that may have been applied over an 18-month period. I hope that that provides sufficient reassurance to Parliament, but I reiterate the point that I remain open to considering those points in due course. I am aware that a number of stakeholders have called for an early and comprehensive review of the impact of the supplement. I welcome the finance committee's comments in their stage 1 report that developing an understanding of the impact of the supplement will be complex and take time a view with which I concur. I consider that reviewing the impact of the supplement will require at least one complete year of data, given the seasonality in housing transactions, the likely for stalling behaviours and the longer-term trends in the housing market. The Scottish Government intends to update Parliament on the outcome of that review in the 2018-19 draft budget, in accordance with our undertaking in the written agreement on the budget process, to provide a commentary on out-turn figures for the devolved taxes for the most recent year, including any variance between out-turn and forecast. As currently drafted, the bill proposes that the supplement does not apply to the purchase of a residential property where missives have been concluded before 16 December 2015, the date of the Scottish draft budget statement, even when the transaction did not settle until after 1 April 2016. Where the missives for the transaction have been concluded on or after 16 December 2015, the supplement has been proposed to apply if the transaction settles on or after 1 April 2016. The Scottish Government has listened carefully to the stakeholder community and intends to bring forward an amendment at stage 2 whereby the supplement will not apply to the purchase of a residential property where missives have been concluded before 28 January 2016, but the transaction does not settle until on or after 1 April 2016. I believe that this adjustment delivers a fairer result for buyers who may have been putting in offers for property or making reservations for new-build property in the period before the detail of the proposed supplement was in the public domain when the bill and the accompanying documents were published on the Scottish Parliament's website. I move that Parliament agrees to the general principles of the Land and Buildings Transaction Tax Amendment Scotland Bill. I now call on Kenneth Gibson to speak on behalf of the Finance Committee seven minutes. Thank you, Presiding Officer. It is with pleasure that I speak on behalf of the Finance Committee in this stage 1 debate on the Land and Buildings Transaction Tax Amendment Scotland Bill. I thank Finance Committee members, the clerks and those who gave evidence to help us to reach our deliberations expeditiously, along with their adviser Professor MacEwn, who produced an excellent summary of the responses whilst working to a particularly tight deadline. Following publication of the UK Open statement in which the Chancellor set out plans to introduce a 3 per cent stamp duty land tax supplement on the purchase of additional homes from 1 April, the Scottish Government set out similar proposals in its draft budget. The Government has emphasised the need to introduce a supplement at the same time as it comes into force in England Wales to mitigate the risk of any related impact on the Scottish property market. That meant that the usual consultation process could not be undertaken and standing orders were suspended to facilitate a truncated timetable for parliamentary consideration of the bill. Whilst the committee noticed that those circumstances were far from ideal, we recognised the reasons behind them and accepted that there must be an element of flexibility in the scrutiny arrangements. In essence, there is a need to balance the risk of not responding immediately to UK tax changes with the risk of unintended consequences from enacting legislation without first conducting full consultation and comprehensive parliamentary scrutiny. The need to achieve such a balance is clearly an issue of real importance to Scotland's public finances and one that may arise more frequently in the future. We intend to reflect carefully on this before setting out recommendations on how best to balance priorities in our legacy report. We wish that our own will be short of the usual consultation exercise and received over 50 responses ranging from professional bodies to individuals concerned about the bill's potential impact on their own property dealings. We then took evidence from a range of stakeholders before hearing from the Deputy First Minister. Turning to the bill's policy objectives, the key intention is to ameliorate any potential market distortions arising from the proposed UK supplement that should impact in particular on first-time buyers. Concerns were raised by some stakeholders that no impact assessment had been undertaken and there was a lack of data on the Scottish second home and biotelect markets. We therefore recommend that the Government commission's research and take steps to improve the level of data available in those areas. Ministers closely monitor the supplement's impact on the housing market and conduct a comprehensive review once sufficient information is available. Following on from that, we also recommend that the Scottish Fiscal Commission should provide a commentary in the first six months of the supplement's operation, including the impact of first stalling by the end of November. I note that today, the Deputy First Minister is suggesting that one full-year data would be more appropriate, and that is something that we will deliberate on. We had mixed views on the policies that likely impact on first-time buyers, with concerns expressed that the supplement would act as a deterrent to investment in new housing developments. Others suggested that whether a supplement not introduced to investors from outside Scotland could push up property prices. Whilst recognising the Government's policy intentions regarding first-time buyers, the committee was also conscious of the need to protect housing supply for those who rent their homes early through choice or necessity. We heard that the vast majority of landlords own fewer than five homes, with large numbers owning just a single biotelect property. Concerns were raised that not only could the supplement deter investment in housing, it may simply result in additional costs being passed on to tenants via higher rents. Again, we consider it essential that the Government closely monitors the supplement's impact on rent levels, particularly in areas where rents are already high. To mitigate the possible deterrent effect on investment in Scotland's housing stock, numerous reliefs were suggested by stakeholders. Unfortunately, it was not possible for us to scrutinise every proposal in the time available, and we remain conscious that exemptions and reliefs have the potential to provide loopholes and opportunities for tax avoidance, with which we therefore invite the Government to comment on the stakeholder's suggestions. The committee was convinced of the case for introducing certain specific reliefs for registered social landlords, local authorities and student halls of residence. Not only is availability of quality affordable housing for those on lower incomes a key challenge facing Scotland, we also heard that many local authorities and registered social landlords have engaged in significant house purchase activity. That has helped to support the construction industry during the period of recent market recovery in respect of student halls of residence. It is clear that they are designed such that they are unsuitable for anyone seeking to buy a home. We therefore recommend that reliefs should be introduced for both types of properties, and that should mirror those reliefs provided for in the original LBTT act. Another proposed relief that she supports is for larger-scale investors purchasing six properties or more. That was suggested by numerous professional bodies and is consistent with the provisions of the original LBTT act, which states that we are six or more dwellings at the subject of a single transaction, then they are treated the same as non-residential property for tax purposes. The UK Government consultation seeks views on reliefs for bulk property purchases, and we are mindful that the provision of such relief south of the border, but not here, could adversely affect investment in the Scottish market. Furthermore, we consider it unlikely that such a relief would cover small-scale investors who are more likely to be in direct competition with first-time buyers to purchase existing properties. Nevertheless, we remain mindful that the relief might need to be reviewed if there are signs of a negative impact on the number of new housing developments due to a decrease in the number of buy-to-let properties being purchased by smaller investors. We are also clear that a grace period should be provided to cover unintended circumstances where our purchases are made temporarily on two properties simultaneously as a result of a sale being delayed or falling through. I am pleased that the Government has confirmed its intention to amend the bill to introduce those reliefs and look forward to discussing them further with the Deputy First Minister in next week's stage 2 proceedings. In conclusion, the committee supports the general principles of the bill, but remains conscious that, although the proposed supplement may appear relatively straightforward, a number of potentially complex issues remain, which will require careful consideration at stages 2 and 3. In particular, there is a need to ensure that appropriate reliefs are introduced, which balance the needs of first-time buyers with those who rent their home and with the interests of housebuilders and investors. That will not be easy, especially given the lack of sufficient data on the current structure of the housing market in Scotland. It is therefore essential that the impact of the bill is closely monitored and a comprehensive review carried out once sufficient data is available. I look forward to considering those important issues further at stage 2 and hearing the contributions of other members to this debate. I welcome much of what the cabinet secretary had to say in his speech and his recognition of the finance committee's recommendations and the concerns expressed by stakeholders. I think that it is important to take a step back and consider the context, because land and building transaction tax was levied for the first time last year. When the cabinet secretary set out his comprehensive plans for the tax, well over a year ago now, it was a matter of a couple of months before he had to think again and bring new proposals back to the Parliament to respond to George Osborne's proposals for stamp duty land tax. Whilst I would observe that it was probably the fastest change of policy in history, I understand that the cabinet secretary's desire to have a similar fiscal position in Scotland, as it is with the rest of the UK. However, now we are presented with the land and building transaction tax supplement, and yes, it was indeed the self-same chancellor, George Osborne, that introduced that in his autumn statement. A new 3 per cent supplement for stamp duty land tax, and the cabinet secretary moved quickly to copy that. Now we have a land and buildings transaction tax supplement on purchases of additional residential properties at 3 per cent for those transactions over £40,000. I know and accept that there are very strong arguments for us to have the same fiscal regime north and south of the border. Our housing markets are incredibly similar. They can and will be influenced by each other, but there are times that we might choose to do things differently. There are obviously times when we want to respond very quickly so that behavioural responses to tax changes are minimised. That has implications for consultation with stakeholders. It has implications for scrutiny by this Parliament. I know that it has not been an entirely satisfactory process for stakeholders, or indeed for members of the finance committee, because of the speed at which things have been done. I do hope that the Government and the Finance Committee will consider that in the future so that we get the balance right. I think that is something that we want to return to, because I can see circumstances in the future of that happening time and time again. I do not think that any of us wants to see a situation where speed means bad legislation with unintended consequences. In that context, let me draw members' attention to the House of Commons Treasury Committee report. It is not something that I read often, but it is now going on my list. I think that it is fair to say that it is not enamoured at all with the Stamp duty land tax supplement. There is a very strong suggestion coming from it. There should be no rush to implementation because of the complexity and because of the possibility of unintended consequences. It would also feel that it would be detrimental to the buy-to-let property market and recognise the importance of this sector for labour mobility. I want to return to that point in a minute. I am not sure, and I do not know whether the Deputy First Minister is any clearer than I am, if there is any possibility that George Osborne might delay implementation or, indeed, substantially change the proposal. For me, that raises interesting questions. Given that the Scottish Government has aligned themselves with the proposal from the UK Government, does that mean that the introduction will be delayed in Scotland if it is delayed in the rest of the UK? Or does the Deputy First Minister intend to proceed regardless? Perhaps it provides us an opportunity to think that through, but, in any event, we need stability and certainty and not chop and change. There are real issues that I know will be grappled with by the Government, but we will decide on the Scottish budget for 2016-17 tomorrow. Assumptions have been made about the revenue that will be generated by this supplement. We will have no idea, though, what the posture of the UK Government is going to be to the Treasury Committee report until at least mid-march is my understanding. I thank the member for giving way. I just wonder if she would accept that this is a good method to protect local people from second-hand, second-home owners. I do, and if you were unclear about that, let me apologise to the member. I do absolutely accept that, but there are unintended consequences that we should be alive to, and not simply just look narrowly at the principle and nothing else. There are wider questions, and there are issues that need to be addressed in the legislation before us. Areas for exemption that the Scottish Government has said that it will think about further and come back to the committee at stages 2 and 3. Let me consider just a couple of those areas. There are many more. The committee spilled those out in pages and pages of possible reliefs. The Scottish Government has a laudable intention of attracting new skilled workers to Scotland. Will any such person, who is perhaps a homeowner abroad and who wants to buy a home here, be liable for the additional 3 per cent? If that is the case, I do not think that that sends out the message that you want that we would welcome those with skills that we need to this country. How will ownership abroad be identified and that additional tax be enforced? Alternatively, Scots, who aspire to maybe have a second home abroad, will be liable for 3 per cent of the purchase price. I think that the answer is yes. I think that it could well be unpopular. However, how would you check it? How would you enforce it? So it is the practical implementation. That woman's name remains on the ownership of the house she leaves. Will she be liable for the additional 3 per cent? If a person who is a homeowner purchases a half steak and a flat, valued at £75,000, will she be liable for 3 per cent of £75,000, 3 per cent of £37,500, or not liable at all? I do not suggest that there is a complexity here that we need to understand. In a short period of time, I wonder whether we would not arrive at unintended consequences. Finally, let me turn to the revenue that it is likely to raise. I think that it is fair to say that the amount raised with residential LBTT is less than expected. We have nine months of outturned data so far, but the modelling of behavioural impacts is critical. LBTT's supplement has benefited from more assessment, but the Scottish Government keeps telling us that there is limited availability of data. We clearly need more. We want to know how you are doing your forecasting methodology. The yield was anticipated at £45 million to £70 million. It has been revised down quite dramatically to £17 million and £29 million. If that is simply a tax to generate more income, then it is a very inefficient way of doing it. The House of Commons Treasury Committee might have got that right, and we should proceed with less haste, but I recognise the dilemma for the Scottish Government, so we will support the general principles of the bill at decision time. Thank you. I now call on Gavin Brown. Five minutes, Mr Brown. It certainly appears clearly to me that both north and south of the border that this measure is far more complex than first appeared when it was announced in the autumn statement. I have the voice of former Minister Jim Maither ringing in my ears as I have reviewed this piece of legislation. Mr Maither once said to me, Gavin, there is no such thing as unintended consequences. There is only lazy thinking. That had an impact on me then and has done since that particular time. Presiding Officer, I think that, ultimately, having thought carefully about the piece of legislation, it is my view that the risk of inaction is greater than the risk of unintended consequences flowing from legislative action. On that basis, I was prepared to support it at the committee stage. We will vote in favour of the principles of the legislation come decision time to date. That said, Presiding Officer, there are clearly significant issues to resolve and I think that the Government would accept that. However, I would say in passing if the UK Government were to decide to delay the legislation south of the border and I have no inside information on that, but if they were to do so, I do think that we should give serious consideration to doing so as well. And Mr Swinney would certainly face no criticism from this part of the chamber where that to be the case. However, I assume that it is going to pass south of the border in the current timescale and therefore my working assumption is that it will be the same here. There are risks, Presiding Officer, Kenneth Gibson captured one of them quite neatly, in that in trying to help first-time buyers we have to be very, very sure that we do not actually end up making them worse off if we see a reduction in development. One of the arguments put forward to the committee was this, that a number of developments that go ahead rely on what are called off-plan sales. So those are pre-sales made in advance of the development being built, but it is much more likely that anyone involved in a pre-sale is a buy-to-let operator or a second homeowner as opposed to somebody going for their first mortgage. Some of those developments rely on pre-sales in order to secure funding and if some of those developments do not go ahead, then there could be a greater danger of lack of supply than we currently have. And I think that as much analysis as can be done on that ought to be done. Did I hear someone once? Yeah, of course I've been waiting to Mr McDonnell. Grateful to Gavin Brown for giving way. He would of course accept though that at the committee I asked for empirical evidence to support that supposition and none was forthcoming. So while the suggestion was made there is currently no data at least none that was made available to the committee that would back it up. Gavin Brown? I mean accept Mr McDonnell makes a fair point. There wasn't empirical evidence. There was evidence from a number of witnesses. There is anecdotal evidence and I suppose that's one of the reasons why all of us on the committee certainly took the view that the government needs to do should actually commission specific research into the issue of the impact of by-to-let and second homes on the property market as a whole. And while the government so far don't seem minded to take that forward specifically, I would encourage them to do so as they work through this piece of legislation. Presiding Officer, I think that one of the issues that I welcome a number of comments that the Deputy First Minister made, particularly in relation to local authorities and RSLs, particularly in relation to large-scale investors and particularly in relation to changes to the transitional period, all of which I think are sensible and fair. I want to end my remarks or in the final minute or so that I have and perhaps in closing is to focus very strongly on the concept of the accidental second home order. The Deputy First Minister isn't minded to make changes at this stage but said that the door is not entirely closed, which I take with great satisfaction and will push hard against that door to ensure that it reopens because I think this stuck out like a sore thumb to me, Presiding Officer. The objective of the legislation quite specifically is not to capture those who are simply replacing the existing main residents but it's obvious to me that there is a severe risk that we capture a significant number of people in that category because if you have a family the family has grown perhaps and they simply want to move to a bigger house to accommodate that if they purchase that new house first and then the sale doesn't happen of their existing home on the same day whether it falls through or simply takes longer for it to happen not only do they have to get some form of bridging loan but they would be immediately liable for this 3% surcharge which could rip about to thousands upon thousands of pounds even for those who are currently out of LBTT entirely for purchases below the threshold there. So I think that's a severe risk I, my time for now is up, Presiding Officer. I'll return to this because I think it is the biggest significant weakness and one that I genuinely want to work with the Government on to get it right at stage 2. Thank you. Thank you, Mr Brown. You will have an opportunity in about four minutes' time. I now call Mark McDonald. You've got four minutes but you could maybe push it to five. Oh gosh, oh gosh. The pressure now, Presiding Officer, to give Gavin Brown time to collect his thoughts for his summing up speech and perhaps give him some content for as well, who knows. I think there are a few things that need to be highlighted and I think the committee took a great deal of evidence in a very short space of time and I think that it was very interesting some of the evidence that we did receive. Jackie Baillie spoke about if this was just a bill designed to generate more revenue. I think that that belies the fact that the genesis of this bill was firstly to ensure that there wasn't a detrimental impact as a consequence of a policy change taking place at UK level and secondly to ensure protection for first-time buyers against bi-to-let investment. I think that one of the things that I pointed out in an intervention to Gavin Brown and I think that I became slightly frustrated by during the course of the evidence taking was that an awful lot of certainty was being drawn from supposition and anecdotal evidence when there didn't seem to be a lot of hard data and empirical evidence backing it up. That made it very difficult for the committee to reach a true value judgment on some of the issues that were being raised with us by some of the witnesses who came before the committee. That's why, as Gavin Brown says, I think that the notion of getting some more data that can really be the bedrock for analysis of impacts on the housing market is absolutely critical and important. As this policy rolls out alongside LBTT itself over a period of time, once you have the opportunity to essentially bottom out for stalling effects and other variations, I think that that will then give us a better idea of impact and perhaps help us to build a slightly better picture of what is happening in relation to the housing market. In terms of reliefs, I think that the committee report and we had some discussion around how we lay it out, but the committee report goes into some great detail about the range of reliefs that have been suggested from various quarters. I think that there are a number of risks inherent with any system of relief that is brought in, that it runs the risk of creating significant loopholes which could then undermine the policy intention of the legislation. So I think that the committee has very properly asked the Scottish Government for its view on the basket of reliefs, but at the same time has focused on a couple of specific reliefs that it feels are necessary. And I think that the Deputy First Minister has responded very fairly to those suggestions. The third issue that I've sort of wrestled with and looked at is and I mentioned it in the evidence-taking committee is around the flexibility that the current process that we go through in Parliament affords to the Scottish Government. It doesn't necessarily relate specifically to this piece of legislation, but I think in general terms if we look at the flexibility that is afforded to the Scottish Government in terms of reacting to tax change or announcing tax changes versus that which is afforded to the Chancellor who can stand up at the dispatch box and announce a change that will take effect at midnight that evening should he so choose to do so. Versus the Scottish Government which under the processes that are agreed through Parliament has to essentially signal its intentions some months in advance of changes taking place and the opportunity that that process allows for behavioural change and for stalling to take place versus that which exists at Westminster I think is something that does need to be explored in more detail in future perhaps by a successor committee from the finance committee but also I think it would be welcome in the next Parliament I think to get some more thinking from the Scottish Government around that as well. I think that the main thrust of that is first and foremost that first-time buyers have to be protected in terms of the purchases that they make and I see that despite being told I could push it to five minutes I'm now being told to hurry up so I will do so Presiding Officer but one of the things I noted in terms of the intentions of LBTT when it was first introduced was to stimulate purchase at the lower end of the market and anecdotally from state agents locally in my constituency we are seeing a stimulation of the market at the lower end which was the intention so I'm confident that that is happening but I think that this is necessary a necessary measure to ensure that that is protected thank you Presiding Officer Thank you Mr Macdonald you actually got four minutes four to five seconds so you did quite well now we go to the wind-up speeches Gavin Brown four minutes Thank you it's been a fairly short debate Presiding Officer I have to say I do want to return to the issue of the accidental second home order because I genuinely think that this could be a pretty big problem and one which I think both south of the border and here it hasn't been considered anywhere near enough because we deliberately want to exclude those as we heard in the policy memorandum those who are just replacing their existing main residents so therefore people family selling their house and the sale doesn't go through it can fall for any reason it could just take longer to sell than they anticipated in both of those scenarios they of course would be liable to pay that sum of money ranging from a few hundred to potentially tens of thousands of pounds in some cases money which of course could be clawed back ultimately but money which would have to be paid up front in the first instance this in my view is wrong for a number of reasons firstly it does just seem to me unduly punitive not only are people in that scenario likely to then need some form of emergency finance or bridging loan but at the same time we add to their stress with this instant bill that has to be paid before the transaction can go ahead in many cases that might just take them to the financial brink it might result in a transaction then not going ahead which could have implications elsewhere in that housing chain because very few transactions take place in a vacuum unless it's just the first time buyer involved there are quite often chains as they're called or a number of transactions reliant upon another transaction taking place and if one of those falls because this tax having to be paid up front it takes them over the financial burden then I think it could have a wider impact on the housing market as a whole it strikes me as unduly bureaucratic Presiding Officer particularly again when the government stated intention is not to bring these people within the realms of the legislation and I suppose also that I just feel there could be a wider deterrent on the market as a whole many of us many of our constituents out there are cautious and you could end up in a scenario where people just as a matter of fact now only buy once they have sold we could end up with a market where people sell their house first and only after they have sold do they consider buying so that they make absolutely sure they're not liable for these thousands of pounds in some cases that may be the right decision but if that were to be the effect on the market place as a whole then I think it could well have a detrimental effect on the economy it could slow down parts of the housing market in a way that we don't want to and I think if we allow that to go on for six months it may take some time to write the market at some point and I think we're better to look at it more carefully now of course Revenue Scotland may prefer the option that Mr Swinney has suggested it makes it cleaner and simpler for them but I urge him in his closing speech at least to say he will speak to more of the legal profession in particular and to those who represent consumers and house buyers to get as much data as he possibly can before taking a final view on this because I'm convinced that if he does so he'll hear more strongly from a number of them that something needs to be done we heard on the committee that a grace period would be one option I certainly think that's one way of doing it though I would say the suggestion of 30 day grace period I don't think goes anywhere near far enough because if a housing sale does fall through it's pretty unlikely not impossible pretty unlikely that the average house sale will then happen in 30 days depending upon which website you look at it can take 8 weeks to 12 weeks on average to sell a house and therefore a lot of people again would be captured if the grace period were to 30 days so I urge the deputy First Minister to give serious consideration to this he has said he's not close the idea I personally would commit to working with him to try and find a solution to this because I genuinely believe our constituents going forward I wouldn't have any constituents post April Presiding Officer but I genuinely believe a number of constituents going forward would see this as a huge matter of regret and we would then have to take emergency action to deal with that and therefore I urge him to indicate he would be willing to discuss in his closing thank you thank you Mr Brown I'm not have any either come with me I'm now calling Llysa Brennan Miss Brennan's 6 minutes thank you Presiding Officer just to sum up for the labour group I think is obviously it's been a very short debate today but we have heard the key points so during the finance committee's evidence gathering session we heard from members about the state of aims of the policy to minimise market distortion in Scotland due to the inward investment from the rest of the UK if the Tories introduced this initiative and the Scottish Government considers this inward investment could cry out first time buyers I do support and we support the principles underpinning this tax to reduce rent-seeking behaviour but it cries out first time buyers from buy to let landlords or others for second time home owners the draft budget estimates that this additional dwelling supplement would raise about £23 million in the first year this sum actually equals the shortfall of Dundee City Council so if you want to ear market for Dundee City Council we really have to be with that but seriously the church institute of housing suggested using the revenue and earmarking it for housing and I would suggest that the Scottish Government ought to consider that because I read in the cabinet secretary's response about how you are trying to promote home ownership and you have got initiatives but actually if you do put the £23 million or the money raised it would obviously help more people to get into the housing I do have some concerns over the bill I think and as everybody's said it is about the lack of credible data it is largely anecdotal data and I did mention at the time about how me and colleagues were involved in the Scottish Government report baseline in the private rent sector in 2009 and one of the recommendations there was actually about improving the data and I do see actually that there's been very small improvements but I think to understand how the market works you need to understand what the motivations are for people owning more than one home and actually renting so whether it is accidental landlords or whether it's people who have inherited to property we just need to understand how the private rent sector is evolving the proportion of households in the private rent sector is obviously increased from 5% in 1999 to 14% now and obviously this expansion has been encouraged by the Scottish Government when you look at the rent increases at the Scotland level over the last year it's saying 1.6% in the private rent sector so maybe so maybe actually one of the reasons if we are concerned about market distortions a rental year if it's saying 1.6% increase it may not be as competitive as some of them are down size the registers of Scotland noted that approximately one in five purchases with a mortgage in Scotland were to first-time buyers between 2005 and 2015 but I think it's important to remain mindful of the context house price annual inflation was 5.6% in England 0.8% in Wales 2.9% in Northern Ireland and minus 9% in Scotland and that's the latest data from ons so the price of properties for first-time buyers is also increasing but at a decreasing rate so it's suggested that it's actually slowed down in the housing market so going back to I'm just a bit concerned that actually there may be unintended consequences and whether the lack of first-time buyers is actually due to supply side issues but it might also be due to demand side issues going back to just the general nature of the economy and employment Revenue Scotland is currently preparing guidance to help taxpayers and the agents understand the supplement and with respect to the implementation of the supplement it's about the concerns like what Gavin Brown has said about the accidental second home owners so I really do think that I would urge the cabinet secretary about the grace period when you think about families who buy a house and it might take a number of months to renovate it they would be affected by the supplement others as Gavin Brown said about who accidentally own a house because something else has happened in the chain or a family who's relocating from England up to Scotland for work purposes and they've bought a home in Scotland and are trying to sell their home in England but then they'll be affected by the supplement so I would really hope that the cabinet secretary I know you say you're going to take evidence over the first six months but I think actually a grace period especially given how quickly this has been implemented and I welcome your comment today saying it's going to be from the 28th of January but I think it would be I would really hope that you consider the grace period a bit further I think the questions that the cabinet secretary ought to address is what will happen if the conservative government of Westminster actually decides to delay the implementation of this tax and how confident is the cabinet secretary that this 3% supplement will change behaviour will prevent second home ownership and will prevent the crying out of first-time buyers so I look forward to hearing the cabinet secretary's comments for these questions thank you thank you Ms Brennan I now call on John Swinney to wind up the debate Deputy First Minister until 640 please thank you I'm always delighted to provide helpful advice to Jackie Baillie and I'm not sure if she was seeking advice but she did ask me of whether there would be a charge applied if one was buying a home overseas and I wasn't sure if Jackie Baillie was perhaps just looking for some advice across the chamber to enable her to undertake her financial planning perhaps perhaps for her retirement which is of course a long way off before we get to that but what I can say is that the tax charge is only chargeable if the additional home is in Scotland but if somebody who lives overseas is buying an additional home in Scotland the charge would be required to be paid in Scotland and of course they would be required by law to report that through the revenue Scotland return so an individual who is not resident here normally buying a property here would have to indicate on their return whether they owned another property somewhere else in the world and that would be part of the administration so I'm happy to provide some further advice Thank you very much Can I ask the Deputy First Minister on that basis does that mean that an incoming worker who maybe is ordinarily resident somewhere else but is buying a property in Scotland would be liable and does he think that would discourage them from coming to Scotland in the first place? Deputy First Minister If they were a home owner in another country yes, the charge would apply and of course people have to weigh up all of the differences and obviously there are many many circumstances we can apply in this debate in individual circumstances but those circumstances would apply in the scenario that Jackie Baillie raises A lot of the debate Jackie Baillie, Lizzie Brennan, Gavin Brown have all made reference to the grace period point and I want to address that in my closing remarks I am prepared to have further discussions about this point I have weighed up the evidence on this issue and I am not satisfied that the provisions of the bill does not provide sufficient flexibility to address this issue but I am very happy to have further discussions about this point either in the run-up to stage 2 or stage 3 to enable me to further consider some of the issues that are involved There is provision within the bill for ministers to bring forward a relief from the supplement of any nature so we can make provision in due course it does not require ordinarily to be undertaken as part of stage 2 or stage 3 and as I indicated I want to give a period of time for us to monitor this issue up until the 30th of October and that will give us a better impression of the issues that are involved at that stage The Jackie Baillie raised the issue of the question of a delay to the UK legislation I have no information about that point but I certainly have no intention of delaying the legislation within Scotland We have taken this decision because prompted by the decision of the United Kingdom Government because I could foresee some market distortion that could take place as a consequence but now that we have established the approach we it supports our policy approach in this respect that we wish to protect the opportunities for individuals to gain access to the property market and I think it's important that that is reflected in the bill One of the other issues that came up in the debate it was raised by the convener of the finance committee and also by Mark McDonald and that relates to some of the arrangements that we will increasingly have to consider and of course we will have to increasingly consider them ever more now that it is clear that we are going to have the powers envisaged under the Smith commission and the associated tax powers that will come from that that we have to consider in our own budgeting and financial process how we undertake the any changes timeous changes to our legislation to ensure that we have appropriate tax arrangements in place I can't pretend that it is ideal that we've undertaken these changes in such a short time scale but we have given them a lot of thought and I am committed in the course of stage 2 and stage 3 to further consideration on the points of detail to ensure that we cover any of the circumstances and scenarios that may arise that require us to make any further provision to this legislation but I am confident that the Government has listened carefully to the feedback of stakeholders to ensure that we're properly prepared and equipped to address any further issues but I do think it would be helpful for the Government and the incoming Government after the election in May to have the benefit of some reflections from the finance committee on what the processes and procedures of Parliament may be like to ensure that we can undertake this type of process of scrutiny in as effective a way as we possibly can do. Mark McDonald also talked about the wider questions of reliefs that would be envisaged under this legislation. I have set out some of my thinking and I am committed to reflecting further on that as the bill takes its course through Parliament. Jackie Baillie also raised a number of points and scenarios about the detail and about the complexity of the legislation. I accept the fact that there is complexity in the legislation but I think that it's incumbent on the approach of the Government to make sure that we explore as many of those scenarios as we can and I'm satisfied that we have the process in place to enable that to be the case. Finally, Presiding Officer, mentioned what was made during the debate about the revenue estimates that the Government has made. We have essentially headline estimates of between £45 million and £70 million of expected revenue from this supplement. I have settled on a scenario of £23 million which is a mid-range estimate that takes into account the effects of forstalling and also the effects of behavioural changes as a consequence. I believe that it is a prudent assessment for the Government to have made and one that is relevant to the budget process that we have set out. So I'm... I reaffirm to Parliament the willingness of the Government to engage in detailed scrutiny on those questions and to ensure that the issues raised with us by stakeholders are fully and adequately addressed as we take the bill through its remaining stages. Thank you, Deputy First Minister. That concludes the debate on stage one of the land and buildings transaction tax amendment Scotland bill. We now move to next item of business which is consideration of motion number 15563 in the name of John Swinney on the financial resolution for the land and buildings transaction tax amendment Scotland bill. I call John Swinney to move the motion. Move, Presiding Officer. The motion will be put decision time to which we now come. There are seven questions to be put as a result of today's business. The first question is motion number 15645 in the name of Christine Grahame on Scotland's national action plan for human rights be agreed to are we all agreed the motion is therefore agreed to the next question is amendment number 15695.3 in the name of Claire Baker which seeks to amend motion number 15695 in the name of Fiona Hyslop on the BBC charter renewal process be agreed to are we all agreed the amendment is therefore agreed to the next question is amendment number 15695.1 in the name of Liz Smith which seeks to amend motion number 15695 in the name of Fiona Hyslop on the BBC charter renewal process be agreed to are we all agreed the amendment is therefore agreed to the next question is amendment number 15695.2 in the name of Liam McArthur which seeks to amend motion number 15695 in the name of Fiona Hyslop on the BBC charter renewal process be agreed to are we all agreed the Parliament is not agreed we move to vote members should cast their votes now the result of the vote on amendment number 15695.2 in the name of Liam McArthur is as follows yes 34 no 65 there were no abstentions the amendment is therefore not agreed to the next question is it motion number 15695 in the name of Fiona Hyslop as amended on the BBC charter renewal process be agreed to are we all agreed the motion is therefore agreed to the next question is it motion number 15694 in the name of John Swinney on the Land and Buildings Transaction Tax amendment Scotland. be agreed to their next question is it motion number 15563 in the name of John Swinney on the financial resolution for the land and Wrth hyn ymwysilwch, rydyn ni'n amgylchedd. Felly mae'n ddwybod i'r ddullustiol. Felly mae'n ddigonwch am ei wneud. Mae'r ddweud i'r ddweud o'r cymdeithasol, rydyn ni'n ddweud o'r ddweud o'r cymdeithasol.