What do you think of this idea of a wealth tax?

[LuluJakey1]

This is from The Guardian this afternoon. It is the third article I have seen in the Press two days promoting this idea.

www.theguardian.com/commentisfree/2020/jul/06/arts-wealth-tax-rishi-sunak-nhs-public-services?CMP=Share_iOSApp_Other

Personally, I think it is bonkers. She seems to be suggesting that ALL wealth in this country - houses, savings, pensions, shares/paintings etc should be subjected to a one off tax of 10% to get us out of the financial mess.

DH and I would have to find about £80,000 cash! We'd have to sell the house?

Yes- Yes it is a good idea and you are BU to criticise it.
No- It is an awful idea and you are right to criticise it.

We own our home outright having lived here for over 30 years and paid off our mortgage. So we have £450k + equity...... the only way to pay out 10% of that would be to sell the house! Then we would need to buy something smaller and cheaper.... where would our children live?

Utter insanity.

Most people I know in London are close to being ‘milllionaires’ based on their ludicrous house value (and ludicrous mortgages) but they are a far cry from comfortable multi-millionaires, both parents working 60/70 hr weeks never taking holidays struggling to afford childcare...that’s not true ‘wealth’ (even though to a country bumpkin like me that sounds hella rich)

We have to stop voting/enabling governments that allow us to believe ‘we the people’ are both powerless and somehow responsible. 🤷🏻‍♀️

Rather than the ‘Everyman’ finding 10% we should start at the top. Demand 10, even 15% cash injection from all high net worth individuals, let’s say anyone one with £50M or more (utterly unnecessary amount of money for one human to have, but I guess we have to allow some ‘aspiration’ in life). There are a lot of billionaires in this country. 10% of their collective net worth would sort us all right out. But they’re protected. Look at sodding Branson and the Beckhams. The system is so unbelievably screwed up.

I would like to see a VAT increase on genuinely luxury goods, perhaps with some leeway: so if, for example, the average bottle of wine bought in this country is, say, £10 then no extra tax on any bottle that costs up to £49.99 but additional VAT if it costs over £50. That still allows those who can afford to splash out some splashing out room without being hit but does hit those who are able to afford the very best of the best without having to worry about the costs. Firmly puts the costs in the hands of those who can afford it.

A blanket % of wealth tax ignores real people's situations. I am well off compared to many because my mortgage was paid off a few years ago with an intheritance. But I have to work and if we look at the wine example above, I would never pay more than £6 a bottle and I would only do that at most a few times a year because my money is needed elsewhere for more important things. If I were in a position to spend £50 on a bottle of wine then I hope I would be willing to 'do my bit' and pay a bit of extra tax on that in full recognition of my very priviledged position in society.

[quote Raella50]@osprey24 It’s not about hating older people, it’s about wanting everyone to share the load of thIs monumental bill. The situation we find the country in now is hardly commonplace and hasn’t occurred before so isn’t comparable to the situation when you bought your house. No one is saying nag you bad things easy.. believe it or not people still don’t have it easy. Many young people struggle just the same as you did to buy a house (without top up benefits or free childcare or £5 coffees - certainly we don’t benefit from those things). Why should those young people have a hug tax hike on their salaries and make it harder still to pay their mortgages whilst their parents sit pretty in their paid-off house that rises in value more each year than their children even earn. It’s wholly unfair. We all need to be on this paying it off together.

@ConcernedAuntie You dl realise that you nag people have all of that ahead of them too? They probably will have to work for even longer, receive even less and be paying higher care fees than you do now too. That’s the reality. Noon is saying it’s your fault that your home will possibly have gathered a LOT of value into those years. What I’m saying is that it’s fair to tax you on it if you’re going to hike tax on early money too. My parents for example have a house worth lore than 2000% of what they paid for it. It’s money that’s has never been taxed. They have a huge private pension and lots of savings and consequently could afford to pay tlwards this bill. They should be paying a percentage of their wealth the same way as younger working people will pay a huge amount in tax from their wages too.[/quote]
Raella.

Sorry, no idea what a nag person is.

Work longer! Did we not work long and hard enough for what we have? MIL started work at 14 retired at 60. Dad started his apprenticeship at 15, retired at 67 (couldn't afford to retire at 65 - was 45 when he bought his first house). I started my first part time job (after school and Saturdays) at 14, full time since 17. My pension age was raised from 60 to 65 and 5 months, so that's 5 years and 5 months extra before I got my pension. I worked for 20 years in a job a absolutely hated because that was the highest wage in the area and enabled us to pay the mortgage. DH worked on building sites from the age of 14 during school holidays, worked full time from 16 until he was 65. Did we all not work for long enough? Do we not deserve what we have?

When we bought our first house, we had not had a holiday for 6 years and didn't have one for a further 5 years after that. A 'night out' was either round our house or a friends house with a bottle of coke and bag of crisps. We had a secondhand bed, fridge and tv and sat on camping chairs. We did all the improvements and decorating ourselves. No one gave us anything. I was 60 before I had enough money to buy my own car.

Nothing we have was handed to us on a plate. I would be quite happy to pay an extra 3p, 4p, 5p in tax but to have the government come along and just take 10% of everything we have. No way.

I'm sorry this makes me so angry. We have worked bloody hard for what we have.

I know that things are not easy for young people today, but no generation has been without it challenges.

Osprey24 - I'm with you.

We could probably pull 10% of total assets together if pensions were excluded. But it would wipe out any savings we had.
Therefore the consequence would be we stop spending. We wouldnt be going to the pub, out to dinner, to the cinema, theatre, theme parks. We would literally replace stuff as essential and pay bills til we had a cushion behind us again.
Many others would need to take out a loan to pay any house equity, so any spending money would be paying off the loan.
It may solve the immediate problem, but the resulting cut back in discretionary spending would be huge too.

So how much more of the Labour manifesto are the Tories going to nick ?

I cannot support increases in personal taxation unless there is proper levels of taxation on companies such as Amazon and Starbucks, and an end to the tax avoidance schemes some people use.

The Duke of Westminster is 29. He owns 0.22% of all the land in Britain and can trace his wealth back to a cousin of William the Conqueror. Basically his ancestor was given huge chunks of the UK almost a thousand years ago when their French ancestors conquered Britain and they've still got it. I don't think he's done a single thing to earn this wealth.

Isn't it about time that we said that we should have that 0.22% back? The fact that his family have still got hold of this after almost a thousand years is pretty obscene. If he'd earned it then fine, but he hasn't.

Exactly @Marketgarden!!!

Exactly.

It's insane to start making out you are going to come after middle-income families when you need to restart spending to prop up the economy. My friends are mostly in that middle-high bracket, but none millionaires, probably one with a house over 1 million, everyone else has 3/4 bed houses on ordinary estates, the odd one has a flat, and at least one has very little. They are all starting to spend again, trying out going to the pub, the odd restaurant visit. Of course if it looks like there will be a tax on their savings/overall wealth, they will just rein that in, perhaps take some tax advice, and stop spending.

There doesn't seem to be a mechanism for targeting the ultra-rich at all, whose spending is not going to be affected by this type of tax. I guess their spending on accountants will simply increase, off-shore use, move to another house out of UK and so on.

Taxing middle-high income ordinary people who have pretty standard homes and one/two modest holidays in a cottage with one trip to Spain is not the way forward if you want to encourage spending! This group are prudent and will not carry on spending if a tax is looming.

We’ve paid tax - sometimes at the rate of 50% on every penny we have. Funny thing is I voted in a way that would keep the Torys out knowing that it would probably mean a labour government and a wealth tax I’m fine with that if the country has a vision and purpose and it’s helping level the playing field for everyone.

But this bunch of lying shitweasles have stolen my EU citizenship caused thousands of deaths and Mismanaged every single thing that’s happened since the election. They are going for no deal because they don’t care about the additional pain and hardship as long as nobody blames them.

They are not having any more of my money!

The real answer is to scrap inheritance tax completely and replace it with a simple low percentage rate "probate tax". When someone dies and probate is applied for, part of the application is paying, say 10% of the value of the assets under probate. Until it's paid (or provided for by a legal charge on property etc), then probate isn't granted, meaning those inheriting can't get their hands on the property, funds, etc etc. It could be like funeral costs where banks are allowed to release funds for probate out of accounts held by the deceased. Have a low threshold so that very low estates don't need to pay it - say £25,000. A low percentage of 10% would be there's no incentive to take convoluted steps to avoid it (unlike the current ridiculously high 40% rate). It would raise massively more than IHT does at the moment (which is ridiculously small as it's easy for the rich to avoid it!).

@osprey24 it certainly seems like that with some
They seem to have no idea that pensioners still pay tax , my 87 year old nan still paying tax as she has a small private pension
She lives in a 2 bedroom ground floor flat bit its technically worth £330000 , where would she find £33000 from she cant downsize as nothing less than that where she lives , plus she is too old to move
She may be selling soon as she will need to pay for a carehome and that is only a few years cover at the price if them ,
People are very forgetful fo they not think previous generations didn't pay for the cost of the war
People will also just move elsewhere if you hit them too hard with anything , those if working age etc so will so more harm than good
Vat hike on ultra luxury items such as really expensive cars , boats , etc
Small increase in income tax for all - we know its coming but thats fine
Tax on second properties - although ultimately it will probably be renter that pays , so maybe higher stamp duty going forward on 2nd homes ans going up another percent per home bought , this might help stable house prices as well as so many are bought up by people to rent etc

I think some of the confusion comes from pensioners not having to pay NI, which essentially functions like a tax but at a lower threshold for much of the working age population.

@Disquieted1

The Duke of Westminster is 29. He owns 0.22% of all the land in Britain and can trace his wealth back to a cousin of William the Conqueror. Basically his ancestor was given huge chunks of the UK almost a thousand years ago when their French ancestors conquered Britain and they've still got it. I don't think he's done a single thing to earn this wealth.

Isn't it about time that we said that we should have that 0.22% back? The fact that his family have still got hold of this after almost a thousand years is pretty obscene. If he'd earned it then fine, but he hasn't.

Most of the descendants of William the Bastards buddies still own the land he gave them. The Anglo-Norman socio-political system is the envy of the world. Why do you think so many foreign dictators are fascinated by the English ? It's hardly our cooking. They want to learn the secret of how to build a society that can keep wealth in the same families despite any number of dynastic struggles, a civil war, a deposing and restoring of a monarch, a union with another country, and 2 world wars.

When the US is 1,000 years old (2776) it's land will have been turned over several times.

This would only work if they go after the top 1%. Unfortunately they are experts at hiding their assets or employing accountants to do it for them. If they don’t hide it they just leave and take it with them .

10% of pension funds? So if you are a year off retiring you lose 10% but if you have bought an annuity nothing? Or do you value the annuity and take money off pensioners too? Along with 10% of the value of their house? How will they pay that out without selling their house considering you have just zapped their pension?

Plus you then have all those small business owners struggling to stay afloat having to find 10% of the value of their businesses?

@TazSyd yes, I can see that would be very concerning for you. I can categorically say that I think there would be a significant minimum asset value required before any wealth tax was implemented, no matter what, so that would help most people on this thread. If you were still over that limit, that would be a concern. Common sense would say that any liquid assets should have the cost of a home removed but, who knows. But honestly, of all the people on this thread, you're the only one whose situation I see as genuinely concerning.

The point is that lots of people are pontificating. And I'm certainly not going to be concerned about a recommendation from a Guardian columnist to a Conservative government. She says v clearly in her article it's what she thinks would work. Not that she thinks it WILL happen.

The experts I am more inclined to believe think that the tax would be applied only over a fairly high threshold (eg £1mn and above), minus debts. And that most likely first homes and pensions would be excluded in some way. Which means the vast bulk of us would be exempt. Unfortunately, it also means that the tax revenue HMRC would claw back would probably be relatively low.

@Purpletigers

This would only work if they go after the top 1%. Unfortunately they are experts at hiding their assets or employing accountants to do it for them. If they don’t hide it they just leave and take it with them .

Don't the really top knobs have all their land in trust - so technically it never changes hands on death (and so never makes it into the Land Registry) ?

Should we all write to our local MPs? I’m about to. If they take any of my house deposit I will protest by stopping spending and if I do spend, I’ll buy things from abroad. Taking my house deposit would be unforgivable.

@raella do you realise what interest rates were years ago on mortgages as well ? Certainly a lot higher people had to really struggle
If you really think no other generation has had to pay , then you are mistaken
House prices need to be stabilised now going forward and something that should of been done years ago when labour were in power as they could see how they were jumping and when the property market became a hotbed for landlords to start buying

It's just not possible. What are they proposing to include? Houses, it that the whole value or just equity? pensions, savings, shares, what about art? How do you value it? Are we including cars? Wine? Watches? Jewellery? All but cash has a negotiable value. What about houses or wealth held abroad?

You can bet your arse that if they say they are bringing this in, share prices will plummet which is what are economy is based on, as people ditch quantifiable shares for antiques, or wine. That the reason wine and art gets such a high value in the first place as people can buy anonymously. It will all disappear.

Plus very wealthy people don't own anything in their own name, a PP mention the Duke of Westminster, he doesn't own any of that land, it's held in trusts and companies and off shore companies. How on earth do you pin down all that?

@Disquieted1

The Duke of Westminster is 29. He owns 0.22% of all the land in Britain and can trace his wealth back to a cousin of William the Conqueror. Basically his ancestor was given huge chunks of the UK almost a thousand years ago when their French ancestors conquered Britain and they've still got it. I don't think he's done a single thing to earn this wealth.

Isn't it about time that we said that we should have that 0.22% back? The fact that his family have still got hold of this after almost a thousand years is pretty obscene. If he'd earned it then fine, but he hasn't.

I very much doubt he does own any of it. If he did he would have been hit by a huge inheritance tax bill. Much more likely it has been protected in a series of trusts etc to avoid tax.

@zombie ni is a working tax though and they would of paid in alreAdy
Can't punish ordinary folk for paying into a private pension
If they do such a think i will stop paying into our work pensions and spend the money now then the state can look after me
So many people never pay anything into the system yet people like this lady want to go after the hard working average people just saving a little
As newsflash to some on here most pensioners arent rich and the downside to their properties going up is they end up paying higher council tax etc , so the posters making out they dont pay there share forget
We pay a lot of taxes in this country already , the mega rich who
Use all the loopholes need to start paying

I imagine a lot of schools would see their fees being paid well in advance. You would just pay 10 year's of fees upfront.