To think an annual property tax is incredibly unfair?

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?

I don't think labour will last long anyway. I don't want,Reform to get in but before long I bet they will.

Taxing people on their private property (especially their primary home) is immoral, imo. As a pp said, it implies that the government is only allowing you to essentially rent your own home, which you can never entirely own. You've already paid tax on the money you've earned and been taxed again when you've bought something with it. Surely that's enough! But no, they want to tax you every year you own it and then take another slice of your pie when you die. It's obscene.

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.

Isn’t it instead of council tax though? So the same principle in that it’s a proportional amount of your property value - it’s just done on current value rather than an arbitrary valuation from over 35years ago?!
or am I missing something?

Ok but you’ve already paid for that asset yourself. Why should I pay £528 a month for the privilige of owning my own asset?

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 would be hit quite hard by this, but i dont think its unfair, no.

I own a very valuable asset. My house is similar to my sisters, but worth twice as much. That gives me choices. I have a store of wealth, i could move to her area and afford a home, she could not move to mine. I could downsize in retirement to fund care or pass money to my dc, her home would raise far less. My DC will inherit twice what hers will.

To afford this valuable asset i had to have a higher income. Plus many homes appreciate loads and that gain is never taxed!

The whole point is to even out the distribution of wealth/assets by taking from those with more. This will also tend to supress people investing in overinflated property, and make it more efficient to invest in other assets that are better for the economy.

The system at the minute is wrong people up north in small flats are paying the same amount as others with 4 bed properties down south in some areas.

presently if I live in Worcestershire - my council tax will go up by 9%

But If I live in Warwickshire it will go up by 5%

with a property tax set at 0.48% it takes away the ability by the council to increase my council tax and the property tax is set by the value of my home/housing market

This could be very interesting

It’s not been decided yet so not fully clear, but I think it’s going to be EITHER stamp duty OR annual property tax. So if you live in a house you paid sdlt on you won’t be charged apt. If you move after the new tax is implemented then you will pay apt but you won’t pay sdlt. Whether it works out cheaper for you depends how long you live there. After 20 years you’ve paid more, after 5 years less. It favours movers over stayers.

Lol.

I love the way when it comes up on rightmove it says

"£24,000,000"

Can you afford it ?

Aside from that, I think it's weird how people go on about taxing millionaires and billionaires, that when the government does actually do something to tax wealthy people its suddenly unfair ?

Or maybe it's the billionaires that would prefer to spend their money on astroturfing rather than CT.

It radiates money by doing away with stamp duty which is one of the main tax disincentives to growth. If we grow the economy we raise more tax without noticing it.

And not all tax reforms have to change the overall tax take. We need big tax reforms to incentivise growth.

I'm assuming this would be instead of council tax.

For us, the proposed 0.48% of property value would be slightly more than our current council tax, but not ruinously so.

It certainly has the potential to reduce the unfairness where people in cheaper parts of the country can pay more council tax than those living in more expensive houses in other areas where they could never afford to live.

The idea could only work if accompanied by a wholesale reorganisation of council funding, though. Otherwise the tax take in poorer areas of the country, which generally have lower property values, would plummet and the councils there would be left starved of funds.

If it’s in addition to council tax, he needs to think about voter retention, unless he thinks only renters vote for Labour.

if it’s instead of council tax I assume he’s working on the numbers - piss off 25%, please 75%. Hope the 25% aren’t mobile enough to move ex Uk, causing the property market to dive and harming the economy.

It is never going to happen, there simply aren’t enough qualified accredited surveyors in the UK to go and value every single property fairly. And you can’t have estate agents doing it they aren’t even regulated, so I just can’t see how logistics work on this scheme. We are in a tiny house in a wealthy area, so if they do a blanket post code valuation etc we would be paying way over what our tiny cottage is worth as most surrounding homes are 2m+.

I also think whoever is valuing will drop values if they are handed some cash, so the whole scheme is flawed.

I like the concept. For too long income has been taxed more heavily. Hope it goes ahead.

Yes those lines re people owning a house on mn and going on about EU rents, of course it’s better to have the security.

They'd have to centralise social care funding to make it work, otherwise loads of councils would be in the same predicament.

When will people stop moaning? Move back up north if you don’t like it.

But what happens once you've done that and are still pursued for more and more tax? Are the homes in the south just going to sit empty or left vacant by the rich corporations who are the only people who can afford them?

And where does that leave the people who live in the north in the first place? Surely, if hundreds of thousands of people from the south are now competing for the same number of northern homes... what do you think will happen to the values of those northern homes, and then the increasing amount of value-based tax payable on them...?

But doesnt everyone in London earn 100k? 🙄

It seems a common assumption on MN, and yet there will be more people in London earning NMW than 100k but the enormous salaries of eg lawyers, bankers, hedge fund managers etc will push up the average.

so id be paying the same, if I had to pay .48% it would be marginally cheaper depending on the valuation, im a d band which is average

https://www.rightmove.co.uk/properties/157474112#/?channel=RESBUY

this property though would be paying £2,095.70 this at most right now as an H band. Which is less than most of the country average band D council tax.

Please explain why you think that is fair tax system

But on a .48% property tax would be paying £240,000

Not necessarily, it’s house price inflation

It will just drive more and more high earners from the uk.

Earning a £200,000 salary costs your employer £237,500 in total. Of this total labour cost, 49.5% goes to the government in taxes. Your actual take-home pay is £117,786, which means your true effective tax rate is 50.5%when factoring in both employee and employer taxes.

Add in car taxes, vat, council tax, private school vat, taxes on fuel and energy bills, and the raft of things you are not entitled to at that salary and it becomes significantly over 50% if you live a typical lifestyle at that salary. It becomes nonsensical to earn well and strive to achieve in the UK.

Under the current proposals if you have used your high base salary to leverage into a flat/house somewhere commutable to say London (and paid stamp) they now want more of that asset too. To pay an additional 0.48% on your say £2m home brings your effective tax rate up by the difference between the current council tax and the new wealth tax - I am guessing circa £5k or 2.5% on £200k base salary.

England IS lovely and has many advantages, but I think lots of higher earners have had enough. The current system isn’t perfect but why should a GP in the NE of England not pay the same council tax as one in the South if they use the same services (or none). Higher earners have already paid increased income taxes etc, and this is further double dipping. Everyone I speak to is planning on moving, and are encouraging their children to move abroad too. The “broadest” shoulders will be slipping down to anyone with a salary over £30k by the time Labour has finished and house prices in the gutter.

Oops looks like I'm wrong but in that case I don't see how this will raise any additional tax monies overall.