Killer arguments against LVT, not (23)

I read the first couple of dozen comments on Guido's thread on the Lib Dem's plans to have a half-a-per cent annual tax on residential property values in excess of £1 million. While admittedly the Lib Dem's have done this in a totally cack-handed fashion (at the very least they could have said it would go hand-in-hand with exempting residential property from IHT and reducing Stamp Duty Land Tax on the most expensive properties from four per cent to one per cent; and the £1 billion it might raise is a drop in the ocean anyway), at least they have set the hare running, er, in completely the wrong direction...

Douglas McWilliams, chief executive of the Centre for Economics and Business Research, points out that it would hit the property market hard, because prices well below the £1 million level would be knocked as well... "Unfortunately the current crisis is not a time for clever-clever ideas for screwing additional tax out of the already hard pressed middle classes at a time when property prices have already fallen sharply"

Ah yes, all those hard-pressed middle class households in their £1 million mansions...

Nick at comment 160 really has his finger on the pulse:

"So I owe £900,000 on a £1,000,000 house how does that make me rich Vince?"

If somebody has a mortgage of £900,000, is it not reasonable to assume that they have a six-figure salary and are bright enough to have factored in interest rate hikes of a couple of per cent to make sure they can really afford it? If they can afford an interest rate hike of a couple of per cent, is it unreasonable to assume that they can afford a tax of half a per cent on the value of their home in excess of £1 million? Which in Nick's example would be £nil anyway, of course.

Anycolourbutbrown at comment 28 chimes in with the inevitable:

...what about the person, who is now a pensioner and who inherited a house, perhaps 40 or 50 years ago. That house may now be valued at well over a million. Why should he have to pay tax on a valuation he has absolutely no control over? Don’t forget, that he may only be getting a state pension or a small private supplement (think of them having retired 15 -20 years ago).

OK. If such people don't want to pay taxes on up-to-date values, how would they like to make do with a state pension frozen at the rate it was when they retired 15 - 20 years ago as well, i.e. between £44 and £58?