One of the most surprising and significant tax cutting moves in today’s Budget by Chancellor Philip Hammond was his decision to help younger house buyers by axing stamp duty on the first £300,000 of purchase price.

The move will mean first time buyers buying a property for £200,000 will save £1,500 and buyers purchasing a property for £300,000 will save £5,000. In high price areas such as London the relief will be on the first £300,000 of purchase price on a property worth up to £500,000.

First time buyers paying between £300,000 and £500,000 will pay SDLT at 5% on the amount of the purchase price in excess of £300,000, a reduction of £5,000 compared to the amount of SDLT they would have previously paid.

This measure will have effect for transactions with an effective date (usually the date of completion) on or after 22 November 2017.

This measure does not apply in Scotland. SDLT was devolved to Scotland on 1April 2015. It will apply in Wales until 1 April 2018, when SDLT will be devolved to Wales.

Mr Hammond said: “With effect from today, for all first-time buyer purchases up to £300,000, I am abolishing stamp duty altogether. To ensure that this relief also helps first time buyers in very high price areas like London, it will also be available on the first £300,000 of the purchase price of properties up to £500,000.

He said the move would mean: “A stamp duty cut for 95% of all first-time buyers who pay stamp duty. And no stamp duty at all for 80% of first time buyers from today.”

Talking about the housing problems the country faced, he said he would introduce new measures to encourage far more private and public sector house building with the aim of fixing the UK’s “dysfunctional housing market” and “restore the dream of home ownership for a new generation.”

His aim is to see 300,000 new homes built per year with a focus on building in urban areas to protect the green belt.