By adding to the costs of the process of buying a house, it deters people from moving. It is a tax on mobility, creating barriers for those wanting to relocate closer to a new workplace.
At scale, it’s a massive impost on a single transaction which inhibits economic decision-making in a less-than-optimal way.
If a relatively well-remunerated HR director living in Greater London (south of the river, perhaps) and working for an organisation in Waterloo, is offered a £12,000 pay rise to move to another employer based north of the M25, the potential stamp duty bill will make the move there financially unviable.
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Unfortunately, stamp duty does not just impose costs on the individual, but on the economy as a whole as it creates a drag on productivity.
And given we have a massive housing shortage I might also add that stamp duty discourages older people from downsizing and from freeing up under-occupied homes for use by growing families.
While the cap on bankers' bonuses has been lifted, a planned rise in corporation tax has been scrapped, and the increase in national insurance has been reversed, it's the permanent changes to Stamp Duty that I think are the most interesting.
Effective immediately, buyers in England and Northern Ireland will pay no stamp duty on the first £250,000 of a property’s value – double the previous £125,000 threshold – and first-time buyers will pay no tax on the first £425,000, up from £300,000.
By making it easier for candidates to move around the country to further their careers, around the margins, this will promote labour mobility. (As a side point, it may also make the north of England more attractive to business creation than Scotland, where these reforms will not apply).
While the increase in remote working makes the physical location of workers less important, the fact that hybrid work appears to be in the ascendant suggest the stamp duty reform still has value.
Indeed, it is part of the answer to the challenges posed by the nation's skills crisis.
Victoria Short is CEO of Randstad UK