Planned reforms of stamp duty should not be rushed by the government, peers have warned.

A House of Lords select committee, which included four former Treasury ministers, said that a key change to Gordon Brown's Budget should not be brought forward in order to meet an "arbitrary date".

Forum Response: British Property Federation

A spokesman for the BPF told ePolitix.com: "The House of Lords economic affairs sub-committee on the Finance Bill has, in its inquiry into the reform of stamp duty, highlighted a number of concerns of the property industry brought to its attention by the British Property Federation and other trade bodies.

"The British Property Federation expressed particular concern over the lease duty proposals, uncertainties regarding Disadvantaged Areas Relief and the manner in which the reforms have been introduced, imposing taxes first and only later consulting on possible reliefs.

"The British Property Federation believes that there is no alternative to proper advance consultation regarding major taxation reforms and are grateful for the sub-committee's recognition of this principle."

Forum Response: Institute of Directors

Derek Brownlee, tax executive at the IoD, told ePolitix.com: "We welcome the government's proposal to remove stamp duty on commercial property transactions in 2000 disadvantaged areas.

"This ought to promote redevelopment of some of Britain's most run down areas. We are not convinced, however, that this measure will create any new jobs or businesses in itself - more likely it will affect the decision of where a company chooses to locate.

"On its own, removal of stamp duty will not be sufficient to regenerate many of these areas. Fundamentally, the state of the local transport infrastructure, the availability of skilled labour, and the state of the economy are all much more powerful factors.

"Also, we are slightly sceptical that the measure will obtain clearance from the EU under the state aid provisions, and as a whole we much prefer a tax regime which is simple and applies nation-wide, so that business has certainty.

"However, the aims are laudable and it will be interesting to see whether this type of tax tinkering can make any impact on deprived areas."

Forum Response: British Retail Consortium

A spokesman for the BRC told ePolitix.com: "We strongly support the conclusions of the Lords Select Committee on Economic Affairs. The stamp duty system is in need of reform. The current proposals however, bear no resemblance to modern commercial practice, will do little to achieve the stated objectives and are potentially extremely damaging to UK retailers.

"The proposals act in a completely contrary manner to commercial practice in the retail sector. As a retailer, leasing is a commercial necessity and is not considered as equivalent to or a practical alternative to freehold.

"The Treasury have claimed that 60 per cent of businesses will be exempt because the threshold is £150,000. In practice this is far too low, as most high street locations, even for relatively small shops, will command rent in excess of this level. The proposals therefore affect retailers of very modest sized shops in small market towns and country towns the length and breadth of the country.

"The proposals in the Finance Bill could seriously undermine flexibility in the property market, deter inward investment, and lead to a decline in the creation of small businesses. It is likely that the additional costs placed on retailers as a result of changes to lease duty will have the greatest influence on start up and closure decisions in marginal locations and could lead to reduced investment in disadvantaged areas."