From the Telegraph:
Ms Abbott, a veteran Left-winger who hopes to run for London mayor told World at One: “I’m very surprised John (sic) Murphy is making these boasts. I support the mansion tax in principle but there are to big problems.
“It’s effectively a tax on London – 80 per cent of it will come from London – and there are problems. The super-wealthy plutocrats, who will all think should pay the mansion tax, probably using their lawyers and accountants will evade it.
If you support a Mansion Tax in principle, the of course it's going to be a tax on London. That's where most of the £2m homes are. In fact, if you support it in principle, as a tax on unearned wealth, you'd actually want more of it hitting London and the odd person with a massive country pile in the cheap bits of Wiltshire to not be paying it.
And does Diane Abbott really have any idea what the hell she's talking about when she talks about lawyers and accountants evading it? Unless the government writes some daft loophole, you can't evade owning a house. Where are you going to put it? Under a mattress? Ship it to Monaco? Of course, even if you ship the house to Monaco, you can't shift the valuable bit of a house in London which is the location.
“But you could be a teacher in Hackney literally who bought a house at the beginning of the ‘80s for £50,000 and it’s worth £1 million and climbing. Jim Murphy can’t surely mean he is going to expropriate money from Londoners to win an election in Scotland.”
She said many people bought homes 30 years that were in areas that were unfashionable then but are now “very worried” about the levy, before adding: “Jim Murphy isn’t helping matters.”
Did those people do anything to make them "fashionable"? No, they didn't. House prices in London rose because of things like government improving railways, selling off council houses and spending billions on housing benefit in London.
Just to add on this: there's a myth about how fashion raises house prices, when it's actually the other way around. You have a run down area, government does something like improving the rail line and it now makes it a place that commuters would like to live in. Rents rise because they can now get commuters to rent the place, which means that you get people who can afford to eat at Gordon Ramsay's rather than McDonalds.
Tuesday, 6 January 2015
From the Telegraph:
My latest blogpost: Diane Abbott Gets LVT Horribly WrongTweet this! Posted by The Stigler at 16:37