Comments on: HIPs suspended from 21st May 2010 http://www.financemarkets.co.uk/2010/05/20/hips-suspended-from-21st-may-2010/ Finance News | UK Personal Financial News & Daily Finance Market News Thu, 12 Jan 2012 23:14:49 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Derek http://www.financemarkets.co.uk/2010/05/20/hips-suspended-from-21st-may-2010/comment-page-1/#comment-20261 Derek Tue, 25 May 2010 19:24:16 +0000 http://www.financemarkets.co.uk/?p=19122#comment-20261 I don't buy the idea that the Treasury will lose £100 Million in revenue from VAT receipt. This simply isn't true. Why? Well the answer is that the money that people previously spent on HIPS will be spent on other things, which will also incur VAT. So, rather than spending £500 on a HIP and paying £87.50 VAT, I will spend nothing on a HIP and have £587.50 to spend on something else - perhaps a new television, or a new sofa. The fact is that I will still spend the money and other businesses will benefit as a result, thus providing jobs for the 3000 people currently employed managing HIPS. That's the way of an economy. I don’t buy the idea that the Treasury will lose £100 Million in revenue from VAT receipt. This simply isn’t true.

Why?

Well the answer is that the money that people previously spent on HIPS will be spent on other things, which will also incur VAT. So, rather than spending £500 on a HIP and paying £87.50 VAT, I will spend nothing on a HIP and have £587.50 to spend on something else – perhaps a new television, or a new sofa.

The fact is that I will still spend the money and other businesses will benefit as a result, thus providing jobs for the 3000 people currently employed managing HIPS.

That’s the way of an economy.

]]> By: Nick Dyoss http://www.financemarkets.co.uk/2010/05/20/hips-suspended-from-21st-may-2010/comment-page-1/#comment-20103 Nick Dyoss Fri, 21 May 2010 12:54:15 +0000 http://www.financemarkets.co.uk/?p=19122#comment-20103 The introduction of HIPs has always been controversial and led to extra complexity in the housing market and ultimately increased costs for the end consumer. The industry has geared up to fulfil the legislative criteria and there will be a period of change. This announcement does mean that solicitors can regain control of the conveyancing process. Home sellers will also benefit from the solicitor’s experience and expertise as well as no upfront costs and sometimes having to duplicate searches when their property remains on the market for a long period. The introduction of HIPs has always been controversial and led to extra complexity in the housing market and ultimately increased costs for the end consumer. The industry has geared up to fulfil the legislative criteria and there will be a period of change. This announcement does mean that solicitors can regain control of the conveyancing process. Home sellers will also benefit from the solicitor’s experience and expertise as well as no upfront costs and sometimes having to duplicate searches when their property remains on the market for a long period.

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