In response to the Lib Dems' vague mutterings about scrapping the 50% top income tax rate and having a Mansion Tax instead, the avidly Home-Owner-Ist Evening Standard gives us a splendid rent-a-quote from the avidly Home-Owner-Ist Tory MP Mark Field:
Mark Field, Tory MP for the Cities of London and Westminster, backed the Chancellor's attempt to close loopholes but added: "Any further meddling with council tax banding would be both unworkable and unpopular."
Quite how stupid is this man? The use of the word "further" would suggest that there already had been some "tinkering". As it happens, there have been absolutely no changes to Council Tax bands since they were introduced twenty years ago, 99% of all homes are in exactly the same band as they have always been (barring those which had extensions built, and even then, the new band only takes effect when the house is sold). And rebanding or revaluing all homes would be an administrative doddle, seeing as of how everything is computerised nowadays.
And along comes the sort of thoughtless individual who votes for people like Mark Field:
I bought my property 12 years ago in Wandsworth when I got married. Both my wife and I owned flats that we sold when we bought our present home for £340k we have a 140k mortgage
Through no fault of our own the property is valued at £1m we cannot move as our kids have grown up here and go to school in the area. They have their friends here. My wife who is a nurse and I work close by. We could not afford £5,000 pa mansion tax.
Jesus, where do you start?
a. Under the Lib Dems' original Mansion Tax proposals, the tax would only apply to the value in excess of £1 million, later amended to £2 million, so this man's tax bill would be precisely zero.
b. A house worth £340,000 twelve years ago was pretty much in the top one or two per cent by value, and like most houses in London, it's trebled in value since, so it's no good him pleading poverty. This chap has made a £660,000 unearned windfall gain and he's complaining about how unfair life has been?
c. "Through no fault of his own"?? These NIMBYs and Home-Owner-Ists fight and fight in order to keep house prices as high as possible and afterwards they disclaim all responsibility?
d. I've checked Rightmove, there are plenty of 4-bed houses in Wandsworth for around the £300,000 mark, so this family would have plenty of spare change if they downsized a bit because they couldn't afford the non-existent tax bill. And sure, their commute time might be a bit longer. Well tough, join the real world.
The very next comment up goes one better:
£2m in London does not buy a mansion. Terraced houses in some boroughs go for close to that. This would be a great way to force anybody, but the super-rich out of parts of London.
You don't get much for £2 million in Mayfair or Kensington & Chelsea, that much is true (but you can get plenty for a quarter as much a bit further out), but these areas are already occupied by the "super-rich". For sure, there'll be a few people who bought decades ago who might be earning much (like the previous commenter), but to whom will these people eventually be selling their houses? To the "super-rich" of course, but that's different, innit?
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3 minutes ago
7 comments:
I never really got the "asset" rich cash poor argument. If our house shot up in value all of a sudden because well it'd have to be like a goldmine under it or something of that extent in this shit hole area but hey we're being theoretical here. I'd not hesitate to sell & buy somewhere else and bank the difference. I never really got the sentimental attachment to someone's home, a home is what you make of it, its more to do with the happiness of the people within it throughout the time they live there. Your new home would be just as much of a home.
Truly for those "asset" rich, cash poor people, my heart bleeds (it really does, pumps the stuff all round my body and everything)
SW, me neither. I've lived at five different addresses all within a four mile radius over the last fifteen years (long story), and I have the same friends, family, kids, job, record collection, books and hobbies. Not much changes really (not even my landline number).
But the Home-Owner-Ists always claim that once you move home you lose all contact with your family, you lose your job etc and that your entire life is erased. Bizarre.
The mansion tax is a really shit idea though. Any form of taxation that features a "step change", like VAT, SDLT is. The idea that a change in value of turnover or property of £1 suddenly makes you liable to thousands of pounds of additional taxation is so demonstrably unfair that it is almost impossible to defend. As you have pointed out so often, they'd be better off instituting bands H to Z for Council Tax, or scrapping banding altogether and using a percentage.
"The mansion tax is a really shit idea though. Any form of taxation that features a "step change", like VAT, SDLT is. The idea that a change in value of turnover or property of £1 suddenly makes you liable to thousands of pounds of additional taxation is so demonstrably unfair that it is almost impossible to defend. As you have pointed out so often, they'd be better off instituting bands H to Z for Council Tax, or scrapping banding altogether and using a percentage."
Although it has been badly worded by the media, the original lib-dem mansion tax proposal was only on the value above £1mil and therefore there is not a punitive marginal tax rate like with SDLT or VAT.
VAT is a particular hated tax of mine from that point of view because i've seen the negative effects of 10,000% marginal taxes on real businesses.
"Through no fault of his own"?? These NIMBYs and Home-Owner-Ists fight and fight in order to keep house prices as high as possible and afterwards they disclaim all responsibility?
Do I detect an element of peevedness in your tone, Mark?
B, Vince's original plan did not have a 'step' (unlike SDLT) so while it was far too timid and just a token tax (like the 50% income tax), I refer you to SW's comments.
JH, I benefitted enormously from the house price bubble, no dispute there. In my defence, I have never, ever signed a NIMBY petition; nor did I whine when MIRAS was phased out; neither did I complain about interest rate increases (I am old fashioned and took out fixed rate mortgages).
So you detect no peevedness at all apart from that which you imagine. That is quite different to the general observation that Home-Owner-Ists are wrecking the economy for their own selfish ends.*
* The quangocracy is just as bad of course, but it's all the same thing in my book. Would you consider it 'peevedness' if I slagged of public sector fat cats?
Why not amend the tax so people can defer the tax until they sell the property?
Or is that just Crayeyzy?
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