To think an annual property tax is incredibly unfair?

I would be affected possibly and although I have an asset I am cash poor. However I think I should pay more and if I can’t I should move. I do think they should sort stamp duty at the same time.

Say that people leave the expensive areas and start to move to the cheaper areas to avoid the tax. What would this mean for people in the cheaper areas? Increased house prices and suddenly your tax will go up too? Is this really good for the area?

The devil is in the detail with the cap of £1200 pa stated to be an “initial cap”. How long will that remain? One year, two?

The devil is in the detail with the cap of £1200 pa stated to be an “initial cap”. How long will that remain? One year, two?

The existing council tax scheme is hugely unfair. I can't say whether a replacement scheme would also be unfair as everything is speculation at the moment.

Do you use less council services than those big houses? Do you have less bins, less children in school, less need for roads and pavements and parks than those big houses?

Council tax is for services not for houses being bigger.

I think a wealth tax is entirely fair. You are taxed in your wealth, if you have more wealth you pay more tax. But I also thought that the poll tax was fairer than council tax.

This isn't whether I got it from, but I've just googled and he's a link

https://www.standard.co.uk/homesandproperty/property-news/andy-burnham-new-land-value-tax-how-would-it-work-b1286663.html

Essentially he's backing proposals by the fairer share campaign.

Well at the moment there are people living in £350k houses who are paying more CT than someone living in a £1m+ house. A new scheme based on % of worth may be fairer. Depending on the detail.

No, but my point is that Council tax is a local tax used to fund local services. It doesn't make sense that expensive areas automatically pay more Council tax if the cost to deliver their services isn't actually more at a local level.

Where are the details of this “existing housing” £1200 cap you mention?

No, if you 'own' an expensive house you could actually have a huge mortgage and be less wealthy than someone that owns a much cheaper house outright. It's not a wealth tax because it isn't taxing wealth. It's taxing ownership of assets even when they are highly leveraged.

Having read a little bit more about the proposals my main concerned is how we'll afford it as a country, as I'm not sure it's going to bring more money in overall.

No one is going to suddenly get a council tax bill of £10k for their house, that's not how the proposal works. For people living in existing houses the maximum increase in yearly cost will be £1,200 pounds, but for the vast majority, the yearly cost will go down or remain about the same. If someone can't afford the increase it can be deferred until the house is sold.

When someone moves house, then the £1,200 increase limit doesn't exist, but firstly they know this in advance when they choose to move, secondly it's cushioned by the removal of stamp duty. Even then, it's not that bad - tske a £1m property in London. If someone moved in after this policy started, they'd avoid stamp duty of £43k, and council tax of say £2k a year and instead would pay £4,800 a year. They'd be better off with the new system for first 18 years of living in that property!

If the property was £750k and council tax of £2k a year, stamp duty would be £27,500 but they'd pay £3,600 a year - better off for 17 years.

By the time it's a house of £500k, people would be better off for over 37 years!

The only people who will be substantially worse off are people moving into multi million pound mansions.

For most of us the effect will be the equivalent of council tax remaining the same or a bit less, but with a new freedom to move house or job without being massively penalised for it.

I'm just now sure how any of this will raise money though, which is why I'm sceptical.

How do you know there will be the first line?

DH is currently so sick he cannot work and I am a student. The extra £250 a month would quite literally be the difference between us affording heating or not in the winter.

We would eventually lose our home if I couldn’t get more work than I’m cramming in between my NHS placements. Or else I’d have to drop out. The home we own outright…

Its a semi detached in zone 6 London. Not a mansion.

This thread makes for an interesting read. We lack details, but lots of pp making good cases both ways.

What can be agreed on is that Council Tax and Land Tax (in Scotland) are not fair systems and reform is needed. I agree with a “mansion” tax but do think we need exclusions for local areas where regular housing has become silly money. I think the mortgage problems are actually correcting things a little near me, but I still think a basic three bed property is by no stretch a mansion.

There will be some allowance or rebate. You may still be worse off but they would implement some sliding scale so it’s not so onerous.
Anyway, if it ever does come in, it will be a great thing.

I come from an area with low house prices. It is great! My friends can generally afford houses even with lower salaries as the earnings:house prices ratio is better. Rents are also lower so they have proportionately more disposable income.

I have moved to a more expensive area where house prices are higher and people have really had to push themselves to buy a property. Salaries are higher but not high enough to make up the difference. They have had to pay more stamp duty , pay more interest and have less disposable income each month.

I am really struggling to understand why my friends in the South should also automatically be paying more property tax under the new proposals being suggested by Burnham supporters? What is the justification? They would love to buy a large detached house for £300k like my friends from home but this isn't possible. It feels like they are being double penalised.

Just to add house prices haven't risen in real terms in the area in live in now for 20 years so the value of my friend's houses is simply money they have paid in.

Frankly, you live in a house worth £1.3 million if that's the case, I don't think £100 extra a month is going to cause you issues.

If I live in a £1.3 million pound house, happily pay an extra hundred pound a month to help reduce the tax burden on tens of millions of people in this country who are less fortunate than myself.

I did the calculations on my own house which is worth above a third of yours, and because we live in quite a low council tax area, ours would also go up, proportionately more than yours would. I still think it's a fairer system.

There will be some allowance or rebate. You may still be worse off but they would implement some sliding scale so it’s not so onerous.
Anyway, if it ever does come in, it will be a great thing.

And those of us who paid £75k of stamp duty but then have to pay double what our council tax is too within just 5 years?

And those of us who paid £75k of stamp duty but then have to pay double what our council tax is too within just 5 years?