to think mansion tax is an unfair tax on London and the South East?

[goodnessgracious]

I disagree with mansion tax but regardless it seems to me to be unfair on Londoners.

Aibu to think that it may also force some people to sell their properties who are income poor but property rich?

Raltheraffe you should see some of the first world woes going on in the 'squeezed middle' thread. People complaining about earning 140K, they have to work so hard...

raltheraffe by that measure we probably should all pack up and go home, because very few of the complaints on this board could rival cancer.

I doubt you'd find anyone who thinks disabled people should be subject to the bedroom tax.

The mansion tax is wrong because it's a tax on unrealised value, rather than on something that's changing hands. It changes the whole relationship between the state and property owners. It's introducing the principle that certain classes of property require the owner to pay ground rent to the state for the privilege of posssessing them - even if they have already paid for the property, out of money that has previously been taxed, or even if their total equity in the property is less than the actual tax. A property isn't 'wealth' until the asset is realised, and owners are already taxed at that point. Introducing as a principle the idea that it's acceptable to tax unrealised wealth means that an owner effectively isn't the owner any more, isn't free to do what they want with their property, is just a sort of leaseholder.

Not only would it be guaranteed to introduce distortions and corruption into the property market but it would have hugely unpredictable effects on laws around property and ownership way beyond what's intended. If Labour wants to strike a righteous pose about soaking the rich surely they can find ways of doing so that are better thought through.

I just find it utterly pathetic that people complain about taxation.

I spent a few years on incapacity benefit. I now pay my taxes and do not begrudge doing so. If it was not for taxation I would have been left with jack shit when I was too ill to work.

I am proud to pay taxes and firmly believe those who are wealthy should pay the lion's share of it-because that is FAIR.

raltheraffe, I think most agree with you but the tax must be fairly levied. I don't have a £2M house but still believe the mansion tax is an unfair way of getting more out of the better off.

Dear MNHQ can we please have an emoticon of a tiny violin to play?

Raltheraffe

You say "I just find it utterly pathetic that people complain about taxation."

Really? You find it utterly pathetic that people are worried about a tax that they may not have the income to pay. You find it utterly pathetic that people are worried that a tax could make them sell their homes and possibly move away from their friends family and support network.

That says more about you than about the people worried. Seriously comparing it to cancer in order to trivialise it is ridiculous. Of course cancer is worse. Are you incapable of understanding people's worries because there is always someone worse off.

at violin emoticon. I think the mansion tax wouldn't be a bad idea. It might help to curb those insane London prices. But if I was facing paying it would I still agree. Not sure. But I can't dredge up much sympathy for those in £2m plus houses.

Vivienne
I understand this thread is very long but please read the examples which could leave people having to move children from school, oap's from a neighbourhood they may have lived all their lives. There have been some real life examples written by posters on how it might affect them and see if you can see passed the £2 million and change your mind.

Raltheraffe. I am sure many people posting here have suffered or have friends or family who have suffered from grievous illnesses. That doesn't mean they can't take a view on the rights or wrongs of a tax policy. You are trying to.compare two completely different things.

But people have to move all the time if they lose their job or can't pay the rent. It seems to me that people whose houses have quadrupled in value through no hard work of their own want all the advantages of having so much unearned profit (I'm sure they wouldn't say no to all that unearned extra profit if they were to sell) but are against any kind of tax on all that unearned wealth. They want to have their cake and eat it.

No I can't see past the £2m. Not when disabled people are having to move house because of cuts. And cuts in housing benefit means a lot of people have to move. People have to sell their home to pay for care. London prices have been a problem for a very long time and it's about time something was done about them. And I heard today that the tax can be deferred till the house is sold.

Yes people have to move all the time, I should many of the people possibly affected have already done so for work several times. The point is if an elderly person (there are several on my street) has to move away from their support networks, family and friends in order to pay a tax that assumes they are income rich then I think it's wrong.

If people incur massive expense of moving because they can't afford to pay the tax I would say that is wrong. You obviously don't think so?

I understand it's a long thread but your post has been answered several times now from previous posters.

The tax won't happen.

I agree. The tax won't happen. So no need to worry about it any more! It just won't happen.

Vivienne please please read some of the thread.

If the tax is deferred because someone can't pay it and they live in the house for decades, then property prices fall (not unreasonable possibility) then people could end up owing more than the house is worth.

If Labour get in then it would be quite a U-turn to not deliver the Mansion Tax.

www2.labour.org.uk/mansiontax/

Perhaps the view is that Labour won't get in or have a majority and that now the LibDems have decided against it (I think) that it won't happen.

Addition people do pay tax on "all that unearned wealth". They pay it when they buy another expensive property or when they die the state will receive a chunk.

I think a tax that targets the rich but in reality many couldn't actually afford to pay from income and would therefore have to sell their home and downsize or move out of the area is frankly wrong.

Wow married dad! Thanks for the link. It's really no wonder people think it's a good idea with propaganda like that.

"Are you incapable of understanding people's worries because there is always someone worse off."

It is not just someone who is worse off. The vast majority of the population are "worse off" than those hit with mansion tax.

Ralteraffe

Your post does show that looking further than the house price tag is difficult for some.

When I said worse off I was referring to their quality of life, moving away from family friends, children changing school not financially.

I am comparing the bedroom tax (spare room subsidy) which affects society's poorest and most vulnerable, to the mansion tax which affects the rich.

But why are you comparing them? Is it not possible to empathy for more than issue?
On my road there are numerous 80 + residents who are working class and one has lived on this road her whole life. There is absolutely no chance she could pay this from her pension. As absurd as it is on paper they cannot release any money from their properties unless they move away from their friends and support network.

This is just one example poster have written numerous on this thread. Have you read any of them?

You seem to be blindly rejecting sympathy based upon someone's unrealised wealth. It's just not as straight forward as you seem to think.

Surely empathy can be given to all sorts of people.

Here are some calculations from one of the estate agents pointing out how much tax is associated with buying and owning a £3m mansion, or as some would call it in London, a family sized home.

£2,660,000
Income tax and NI paid on the £3,000,000 of net income required to buy the property

£210,000
Stamp duty paid on the purchase (7% on £3,000,000)

£350,000
Annual mansion tax for 35 years (1% on £1,000,000)

£1,070,000
Inheritance tax on sale proceeds (40% on £2,675,000)

£4,290,000
Total tax take on lifetime ownership of £3,000,000 property

It matters that taxes are seen to be fair. A tax, not on the money you actually make but on the theoretical value of your home that might not bare any relation to what you actually paid, is not fair.

Tax house sale profits, annoying and will effect far more people, but fine. Tax money people don't have but might have in the future, isn't fair.

The bedroom tax isn't a tax at all, it's just a reduction in money you are given. The mansion tax isn't a tax on mansions most of the time, but family homes. The house earlier in the thread linked too was for sale now for £2.5m when a similar sized on on the same street was sold in 2002 for £400k. It doesn't follow that someone who bought a house in 2002 for £400k is 'super rich' - infact, it's highly unlikely. Of course some people living in £2m+ houses will have bought them for £2m, or bought them for what was a very high amount compared to wages when they bought, but 12 years ago, 2 people earning £50k would be at the richer end of middle class, but not super rich. (you're talking doctors wages back then, not traders).

If they sold their house they would become rich, and at that point, it would be a lot more appropriate to tax the money, but taxing before they get it isn't fair or reasonable.