A recent poll reveals that three-quarters of retail investors believe removing the 0.5% share purchase levy would encourage more investment in UK shares, amid ongoing industry campaigns and government considerations to overhaul the tax.
Three-quarters of retail investors say removing the 0.5% levy on share purchases would make them more likely to put money into UK equities, according to a recent poll by Interactive Investor, a sign that the investment industry’s long-running campaign against stamp duty on shares is gaining traction.
The levy, charged at 0.5% on electronic purchases through Stamp Duty Reserve Tax and on most paper transactions over £1,000, is set out on the government’s tax guidance pages. The tax does not apply to foreign shares bought outside the UK in many cases, a difference industry figures argue tilts the playing field in favour of overseas markets. According to Interactive Investor’s survey, 37% of respondents still named the UK as their top target for investment this year, while interest in the United States has slipped to 17%.
Broad industry pressure has been mounting. Major platforms and broking firms including Hargreaves Lansdown, IG, AJ Bell, Bestinvest and Interactive Investor itself have joined calls for the levy to be abolished, arguing it raises costs for savers, reduces market liquidity and discourages listings in London. Business groups and corporate leaders have backed the appeal, urging the Chancellor to go further than the limited concessions announced to date.
Chancellor Rachel Reeves introduced a targeted relief in the November Autumn Budget, granting a temporary stamp duty holiday for newly listed UK companies for three years. The move drew praise from market participants but also fresh demands that the tax be scrapped entirely to stop capital flowing overseas. Media coverage in October 2025 noted Treasury consideration of a two- or three-year exemption for new listings, while industry voices described the holiday as a welcome but partial measure.
Independent analysis supports the case for removal. Modelling commissioned by the Centre for Policy Studies and carried out by Oxera suggests abolishing the 0.5% charge could raise long-term GDP by between 0.2% and 0.7% and boost annual business investment by up to £6.8bn. Proponents say scrapping the duty would make UK equities more competitive with markets such as the US, which do not levy an equivalent transactional tax and have attracted investors with deep technology and AI-focused listings.
Political and economic risks weigh on investor sentiment alongside tax considerations. Interactive Investor’s research found geopolitical instability as the leading worry for nearly half of investors, with concerns about tariffs and the state of the UK economy also prominent. The Autumn Budget itself has unsettled many retail investors: changes such as the freeze on income tax thresholds, a council tax surcharge on properties over £2m, and higher dividend taxes were cited as significant anxieties. Around a quarter of respondents said they were concerned about fiscal drag and over 10% highlighted dividend tax increases.
Industry commentators stress the importance of tax-efficient wrappers after the Budget changes. “It’s still very early in the year, so it’ll be interesting to see if investors’ strategies shift should these geopolitical tensions escalate in the coming months. But so far… retail investors are prepared to hold their nerve despite uncertainty and invest for the long-term,” said Esmund in commentary accompanying the poll.
Critics of abolition caution that any removal of stamp duty should be designed to support genuine capital formation rather than merely shifting trading volumes. Proponents counter that lower transaction costs would encourage retail participation, deepen liquidity and make the London market a more attractive venue for companies seeking to list.
As debate continues, the government has so far combined targeted relief for new listings with broader calls for measures to revitalise capital markets. Whether policymakers will move from limited exemptions to full abolition remains the central question for an industry that says the answer could determine the UK’s ability to compete for savers’ capital in a fast-changing global market.
- https://www.cityam.com/scrapping-stamp-duty-could-boost-investment-in-uk-stocks/ – Please view link – unable to able to access data
- https://www.gov.uk/tax-buy-shares – This official UK government page provides an overview of taxes applicable when purchasing shares. It details the 0.5% Stamp Duty Reserve Tax (SDRT) on electronic share purchases and the Stamp Duty on paper share transactions exceeding £1,000. The page also outlines exemptions, such as when shares are given for free or when subscribing to a new issue of shares. Additionally, it mentions that foreign shares bought outside the UK are typically exempt from these taxes, though other taxes may apply.
- https://moneyweek.com/investments/stocks-and-shares/city-bosses-call-for-stamp-duty-on-shares-to-be-scrapped-to-save-uk-stock-market – This article discusses calls from UK investment leaders and major platforms, including Hargreaves Lansdown, IG, AJ Bell, Bestinvest, and Interactive Investor, for the abolition of the 0.5% stamp duty on UK share purchases. They argue that the tax discourages investment, harms liquidity, and places UK shares at a disadvantage compared to overseas markets. Over 30 major company leaders and business groups, such as the CBI, have joined this call, urging bold reform to bolster the London Stock Exchange’s global competitiveness.
- https://moneyweek.com/personal-finance/stocks-and-shares-isas/stamp-duty-uk-shares-isa-rachel-reeves – This article reports on the investment industry’s urging of UK Chancellor Rachel Reeves to remove the 0.5% stamp duty on UK-listed shares held within ISAs. The move aims to boost domestic retail investing and invigorate the London Stock Exchange. Industry leaders argue that scrapping stamp duty would effectively encourage investment in UK companies without imposing restrictive requirements. AJ Bell and trading platform Tradu emphasize that removing the tax would lower investor costs and enhance the competitiveness of UK shares compared to US markets.
- https://www.trustnet.com/news/13464414/a-good-start-investors-given-stamp-duty-holiday-on-newly-listed-shares – This article discusses Chancellor Rachel Reeves’ decision to introduce a three-year stamp duty holiday for newly listed UK shares, effective from November 27, 2025. The move aims to support UK capital markets and assist firms in raising the capital they need to grow and invest. While the investment industry welcomes this initiative, there are calls for the government to consider abolishing the levy entirely to further enhance the competitiveness of the London Stock Exchange.
- https://cps.org.uk/media/post/2024/stamp-duty-on-shares-is-a-tax-on-growth-new-cps-modelling-shows/ – This report by the Centre for Policy Studies presents independent modelling by Oxera consultancy, analysing the impact of abolishing stamp duty on shares. The findings suggest that removing the 0.5% tax could lead to a permanent increase in GDP of between 0.2% and 0.7% in the long run, alongside an increase in annual business investment of up to £6.8 billion. It also highlights that no other major financial centre imposes a tax on transactions at this level, or in many cases at all.
- https://www.theguardian.com/business/2025/oct/02/uk-considers-giving-newly-listed-company-shares-stamp-duty-exemption – This article reports on UK Treasury officials considering giving newly listed companies an exemption from the 0.5% stamp duty on share transactions, as part of Chancellor Rachel Reeves’s budget in November 2025. One option under consideration is a holiday of two or three years on the tax. Critics argue that the tax penalises people buying British shares at a time when the government is keen to revive the UK’s previous status as a major venue for global stock market listings.
Noah Fact Check Pro
The draft above was created using the information available at the time the story first
emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed
below. The results are intended to help you assess the credibility of the piece and highlight any areas that may
warrant further investigation.
Freshness check
Score:
8
Notes:
The article references a recent poll by Interactive Investor, dated 2 February 2026, indicating current relevance. However, the narrative includes information about a stamp duty holiday announced in November 2025, which may not be recent. The inclusion of older material alongside new data raises concerns about the freshness of the content. Further verification is needed to confirm the originality and timeliness of the entire article.
Quotes check
Score:
7
Notes:
The article includes direct quotes from Interactive Investor’s CEO, Richard Wilson, and other industry figures. However, these quotes cannot be independently verified through the provided sources. The lack of verifiable sources for these quotes raises concerns about their authenticity and accuracy.
Source reliability
Score:
6
Notes:
The article originates from City A.M., a UK-based business news outlet. While City A.M. is a known publication, it is not as widely recognised as major news organisations like the BBC or Reuters. The reliance on a single source for the narrative, without corroboration from other reputable outlets, raises concerns about the reliability and independence of the information presented.
Plausibility check
Score:
7
Notes:
The claims about the impact of stamp duty on UK stock investment are plausible and align with industry discussions. However, the article lacks supporting details from other reputable sources to substantiate these claims. The absence of corroborative evidence diminishes the credibility of the assertions made.
Overall assessment
Verdict (FAIL, OPEN, PASS): FAIL
Confidence (LOW, MEDIUM, HIGH): MEDIUM
Summary:
The article presents information about the impact of stamp duty on UK stock investment, referencing a recent poll by Interactive Investor. However, concerns about the freshness and originality of the content, the inability to independently verify quotes, reliance on a single source, and lack of corroborative evidence from other reputable outlets diminish the overall credibility of the piece. Given these issues, the article does not meet the necessary standards for publication under our editorial guidelines.