Reeves plan to tax houses over 500k PART TWO

Nothing where we live is under this threshold, perhaps 20:years’ ago

Exactly
The Government doesnt pick and chose who pays tax on other purchases
You buy something there’s a tax to pay
If not everyone pays then others have to pick up the tab
Again!

Currently properties under £125k do not pay stamp duty. So no. Everybody does not pay it. All that is changing in that regard is that the threshold is getting higher.

But it will take many many decades to be cost neutral and this is why it's worse. The government will suddenly lose out on all the stamp duty that would have been paid on houses under £500k. They will also lose out on a large percentage of the stamp duty that would have been paid by those houses over £500k. How do we fund this shortfall? You do realise that any increase to National Debt will lead to ever higher interest payments so it's something that needs to be factored into the whole equation.

It's also worse because it ultimately is relying on the few to fund the many. We know how these policies work and yet Labour keep pretending they will miraculously work here. Look at the non dom tax. We have to accept that ordinary people need to pay taxes like stamp duty.

Incidentally I see a number of property professionals are supportive of the measure and suggest it will get the market moving and ultimately lead to price increases lower down the market as stamp duty isn't an issue anymore. Is that really what people want? The money goes to the vendor instead of the government and ultimately inflated the market further.

Yes I’d rather pay stamp duty. They’ve already increased it

in the SE modest houses are well over 500K

No, it doesn't apply equally because under the current stamp duty system everyone pays something. If the government want the policy to be cost neutral and to not apply to the majority of house purchases then it doesn't take a rocket scientist to work out that those that do pay the new tax will have to make up the shortfall. I don't understand why people don't understand this.

You're comparably rich compared to the rest of the UK.

And like it or not, the most likely reason that you have amassed that amount of property wealth is because successive governments have failed to control property price rises in the interests of the country as a whole, and tax property appropriately.

As I said before, everyone wants more and better services. And everyone seems to think it should be someone richer than them who pays for it. And everyone has a story why. Because they have worked hard. And scrimped and saved while doing all sorts of vital work. And they just don't deserved to be taxed. Even though they might have more wealth than a very significant fraction of the population.

So austerity was pointless then? Where’s all the money gone? And I notice that’s not real terms, it takes no account of inflation.

The difference with stamp duty is that it is a known amount and if you borrow to pay it you know how that will cost you annually etc

once the property tax has been introduced and the principle established you then have uncertainty over the amount as you don’t know if a government will come in and ramp it up etc. perhaps I just distrust governments when it comes to tax rates

It's so depressing as property taxes already high in the UK

https://taxfoundation.org/data/all/eu/real-property-taxes-europe/

This cash cow has already been milked and yet they come for more.

But it's not applicable to the same extent. Nobody is saying that the purchase of a more expensive home shouldn't bring about a larger tax bill than that of a cheaper home. That's the current system. The new tax though would create a threshold where it was effectively tax free to buy or sell a property below £500k and could get very very pricey to buy an expensive home above this threshold.

This new system would appear to bring in precisely zero extra money which one would think would be the whole point of the exercise.

i think they’re actually looking at annual property taxes. The thing is in other countries you get tax relief on property maintenance - even interior decorating. You can’t just land homeowners with £££ without some incentive to keep the home in good order.

I really don’t want to be argumentative but everything you said in the paragraph I quoted is equally applicable to Stamp Duty.

But how is that worse than stamp duty? That is also a tax based on the value of the house you are buying but it starts at a much lower level.

Both go up in increments. The 0.54 % is for houses between £500k and £1million. I don't know what the higher bands are. I guess ultimately the money will be made up because as people buy houses and shift onto the new system they will be paying regularly so each house above threshold will be generating that income forever whoever lives there instead of unpredictable irregular lump sums.

No, it doesn't apply equally because under the current stamp duty system everyone pays something. If the government want the policy to be cost neutral and to not apply to the majority of house purchases then it doesn't take a rocket scientist to work out that those that do pay the new tax will have to make up the shortfall. I don't understand why people don't understand this.

No, it doesn't apply equally because under the current stamp duty system everyone pays something. If the government want the policy to be cost neutral and to not apply to the majority of house purchases then it doesn't take a rocket scientist to work out that those that do pay the new tax will have to make up the shortfall. I don't understand why people don't understand this.

Because it's essentially punishing people for daring to own a house worth a certain value. The underlying assumption is that people that 'own' houses worth £500k are somehow inherently wealthier than those that own a house worth £499k when we knowthis isn't the case. It ignores regional variance, needs of family units and those that aren't geographically mobile. It is designed to disproportionately certain areas and regions.

All that equally applies to Stamp Duty.

This is in real terms according to IFS
https://ifs.org.uk/total-uk-public-spending

If you can buy a £600k house you either have a lot of equity or a very good income. Only 20% of homes are over £500k so it surely does indicate a degree of wealth.

The difference with stamp duty is that it is a known amount and if you borrow to pay it you know how that will cost you annually etc

once the property tax has been introduced and the principle established you then have uncertainty over the amount as you don’t know if a government will come in and ramp it up etc. perhaps I just distrust governments when it comes to tax rates

I don’t care if it’s from God, it doesn’t take into account inflation.

So austerity was pointless then? Where’s all the money gone? And I notice that’s not real terms, it takes no account of inflation.

Here
My data is from gov.uk

So austerity was pointless then? Where’s all the money gone? And I notice that’s not real terms, it takes no account of inflation.