The group that represents the UK’s fastest growing fintech companies has called for the government to scrap stamp duty on shares to boost London’s flagging initial public offering market.

Innovate Finance – which counts Revolut, Monzo and Zilch among its members – has called for the Treasury to ditch the 0.5 per cent levy on UK stocks to help boost British equity ownership and revive the London Stock Exchange’s appeal as a listing venue.

Ousted Chancellor Rachel Reeves introduced a three-year stamp duty holiday for new listings in her 2025 Budget, which the body described as “welcome”, but the move has failed to so far translate into a wave of new listings.

“Now is the time to abolish stamp duty on UK listed shares in entirety,” Innovate Finance said in a new report.

“Abolishing stamp duty on UK shares would remove this competitive disadvantage, encourage greater domestic investment, strengthen London’s attractiveness for IPOs and help reverse the decline in British ownership of UK companies.”

Stamp duty ‘exposes’ UK firms to takeovers

Total tax receipts for the shares levy rose 35 per cent in the 2024 to 2025 financial year, with the HMRC collecting some £4.3bn. Despite Reeves’ intervention in her final Budget, pressure has remained high on policymakers to improve conditions for companies considering a float in the City.

Officials have courted the fintech industry – many of whom are vocal about their ambitions for a public debut – in hopes of luring them towards a London listing.

The boss of fintech unicorn Thought Machine previously told City AM that Reeves’ changes were not “big enough to really change anybody’s mind either for or against” listing in the UK.

Innovate Finance said the tax made raising capital in the UK more expensive and dissuaded domestic investment.

“It exposes UK listed firms to a reliance on overseas capital, takeovers and relocation,” the group added.

Foreign takeovers have swept the London market in the last year. September kicked off with a trio of London firms accepting bids to be taken private in a single morning.

FTSE 250 members Bodycote and Gamma Communications, as well as energy firm Capricorn, each agreed to be taken private in deals worth a combined £3bn.