DEPUTY First Minister John Swinney is facing calls to overhaul his plans for a replacement to stamp duty by bringing in a tax cut worth £90 million.
The Scottish Conservatives have said that tax on property transactions should start at purchases worth £140,000, rather than £135,000 proposed by the Finance Secretary. The party said the move would mean almost half of house purchases in Scotland would be tax free.
Ahead of negotiations over the Scottish budget, the Tories also proposed that rates of tax on homes costing between £250,000 and £500,000 would be halved from 10 per cent proposed by the SNP, to five per cent.
Mr Swinney's plans for a new Land and Buildings Transaction Tax on property, which will replace stamp duty in April, are revenue-neutral.
The Conservative proposals, meanwhile, amount to a large tax cut which it is proposed would be paid for by increases to the Holyrood budget through the Barnett Formula, which result from measures outlined in George Osborne's Autumn Statement.
The party has also argued that Mr Osborne's stamp duty cut, announced earlier this month and in force in Scotland until the new system is introduced, means Holyrood's block grant will be reduced by a much lower amount than previously anticipated, freeing up more resources.
Scottish Conservative finance spokesman Gavin Brown said his party's "affordable and fair" plan would help first-time buyers as well as those moving up the property ladder.
He said: "We cannot have a situation where ordinary families are paying higher tax rates than the rest of the UK for no good reason."
Estate agents welcomed the Tory proposals, which they said would stimulate the housing market. Following the UK Government's announcement of a stamp duty tax cut, which came two months after Mr Swinney outlined his proposals, the SNP has been under pressure to alter its plan.
Blair Stewart, a partner with Strutt & Parker, said: "The proposals put forward by the Scottish Conservatives can only be a good thing for the property market. The proposed 10 per cent tax on homes over £250,000 is painfully punitive and this has been highlighted by the changes to stamp duty in the rest of the UK."
Mr Swinney has said more than 80 per cent of house purchasers in Scotland are better off under his current proposals than the new UK regime.
A spokesman for the Scottish Government added: "We are willing to consider alternative rate proposals, but those bringing them forward must be able to demonstrate that they are affordable in light of changes to Scotland's block grant."
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