There's the usual outpouring of gibberish (both left- and right-wing) in the comments to the Daily Mail article about the Mansion Tax, but this one (currently fifth-worst rated, unsurprisingly enough) makes perfect sense to me:
By my calculations, from speaking to work mates we all pay approximately 1% of our property values annually in council tax ie £2,000 on a £200,000 house, this formula obviously only works until you reach the top band of council tax and from then on you no longer pay the proportional 1% rate and the percentage decreases as the house value increases.
My view is the 1% rate should extend to all properties as the wealthy can't use accountants to hide houses and everyone gets to pay the same rate (don't want to hear any nonsense about widowed poor old ladies living in ten million pound houses). Dan, Petersfield, 20/8/2011 11:57
Correct.
And that extra 1% on higher values homes would raise enough money to get rid of the stupid taxes on land & buildings (Stamp Duty Land Tax, Inheritance Tax, capital gains tax, all of which happen to be Jealousy Surcharges) as well as a stupid Poll Tax (the TV licence fee). I really, genuinely don't understand why people have a problem with the idea.
A grim document
16 hours ago
16 comments:
Thing is they're not living in a 1,000,000 pound house, they're living in a 100,000 pound house on 900,000 pounds worth of land rights.
ac1 btw
Best way to get rid of the TV tax is to turn in into a subscription.
Get's rid of the information pollution the BBC does.
AC1
AC1, maybe it's £900,000 of "land rights" but under current rules those form part of the total selling price of the house.
How much money the BBC 'should' get and how it 'should' be raised are two quite separate issues. In the spirit of minimising admin costs, they could just add it to people's Council Tax bills. And if we decide, in our infinite wisdom that the BBC can make do with £500m a year instead of £3,100 million, then we can use that money to reduce the deficit or cut other taxes.
" I really, genuinely don't understand why people have a problem with the idea."
I'd say it was because the rich and influential would end up paying more and the poor and uninfluential would end up paying less, and it's the rich and influential who are orchestrating all the fuss.
B, quite who'd pay more or less depends entirely on which taxes we replace.
It's not too difficult to get rid of a mixture of jealousy surcharges, poll taxes and indeed subsidies (C Tax Benefit) such that hardly anybody ends up better or worse off in the medium term, and who's to say that everybody is currently paying the 'right amount' in the first place?
The reason that people don't like the idea is because they like to think that one day they too will get free money from the housing market.
As much as I hate all the taxes you list, I would be much worse off if you replaced those first. Can we replace an "income" type tax first please?
BE, there will be various different reforms on Day One.
1. The 1% home value tax, as discussed.
2. Scrap tax relief for pension contributions and use the saving to get rid of 50p tax and 40p tax rates (ultimately merging income tax and Ee's and Er's NI into a single flat tax rate of about 30%).
3. Replace entire welfare system and tax-free personal allowance with a flat rate Citizen's Income (= effective personal allowance for tax of about £11,000). This would save about £50 billion a year into the bargain!
I'm sure you can find something to like out of all that (as well as stuff to dislike!).
"And that extra 1% on higher values homes would raise enough money to get rid of the stupid taxes on land & buildings ...as well as a stupid Poll Tax .. I really, genuinely don't understand why people have a problem with the idea." Because they expect that your tax would be additional, not instead of. And who's to say they're wrong?
D: "And who's to say they're wrong?"
That's the beauty of LVT. It would be wildly unpopular, so any government seeking to introduce it would have to demonstrably scrap a shed load of other taxes to make it palatable :-)
The idea that a knock-on would be the bankrupting of the Beeb makes it more attractive.
Anyway, I'll vote for a sort of exploratory, experimental version of your tax - start by applying it to British Residents who own property abroad. Phase it in - start with Tuscany.
D, no, no, Scotland is where we traditionally try out new taxes. Why break with tradition?
MW: " Scrap tax relief for pension contributions "
I trust you would also change the tax treatment of pensions in payment (similar to free market annuities now) so that double tax did not result?
AC, golden rule - I can't flesh out the full manifesto on this here 'blog, so if in doubt, apply common sense:
1. Tax treatment of pensions already in payment still liable to same tax rates as before.
2. All money in existing pension funds can be taken out, subject to one-off tax charge of (say) 25% of total amount in the pot. Whether the saver takes cash value or ask for shares to be dished out in specie is up to him.
3. If you want to leave your money in the pot until you retire, feel free to do so, it will be taxed accordingly as and when you take it out (as lump sum or annuity or whatever).
4. Funds will of course have to be segregated between "old funds which got tax relief on the way in and which will be taxed on the way out" and "new funds which did not get tax relief on way in and will not be taxed on the way out".
I've explained all this before and would have thought it all blindingly obvious.
Hi Mark,
I thought you'd enjoy this bit os special pleading:
http://epetitions.direct.gov.uk/petitions/318
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