Proposed Wealth Tax

[BootsieBarnes]

It's been discussed in the press that the Chancellor is considering a one-off wealth tax of 5% on assets over £500k. Allegedly this is being considered as part of the March budget to make a dent in the huge Covid debt the UK is facing.

So in real terms that would be a £25k tax bill for someone who has assets valued at £500k, such as property.

What do you think about this? would your family be able to swallow a tax bill that size?

I'm not doing any research, I just read that and thought about the impact it would have on families living in houses in that price bracket.

I've put on voting as well for interest. I'm not actually sure where I stand on this as I can see both sides, so this is just an arbitrary allocation just for voting.

YABU - people with assets that big should pay

YANBU - that would be unfair

My house is worth more that. But I only have a couple of thousand in savings, my house has appreciated in value and my wages have not gone up!

I find this kind of scaremongering unhelpful since it isn't a fact that it's going to happen, but if it did I would be very unhappy, given the amount of tax we've accepted and paid already: 40% income tax, family money lost through inheritance tax, capital gains tax, stamp duty, VAT, the loss of gains through drops in investment potential and property rates. Like many others. The people to chase are the ones who have been avoiding paying tax - close the loopholes, target the ones who have squirrelled their money elsewhere. Not the honest who have worked hard, looked after their money and now want to provide for their future and that of their children. Also I'm deeply unhappy that it's got to this point. I didn't vote this lot in. If Starmer had been in charge we wouldn't be in this position.

Oh come on @AlwaysLatte! That’s absurd. I’m no defender of the government - in fact as far from it as you can get - but this pandemic was always going to cost billions, no matter who was prime minister.

Who paid for your education? Your healthcare? Your children’s education and healthcare? Of course you should pay tax on the money you earn and the more you earn, the more you pay. Paying tax is paying your dues as a citizen, not giving it away

Of course I pay tax, but when almost half your income is taken as tax can you see why the thought of paying yet more gets annoying?

Everyone has access to education in this country, we all make choices. Lots of people work and study very hard, pay their own way through university by working part time, live frugally and save for years... to achieve an income that gives their children a better start in life. They are not necessarily ‘privileged’ they earned it by hard work and going without other luxuries. Most assets don’t appear by magic.

Of course I pay tax, but when almost half your income is taken as tax can you see why the thought of paying yet more gets annoying?

As a higher tax payer for most of my working life I wasn’t annoyed. I had a hell of a good time spending my money after the tax man had taken his cut.

What really pisses me off are those that assume anyone who has substantial money/assets must've been given them, or do nothing for them, or "don't really deserve them", forgetting that actually there are people who have huge debts from training for jobs that pay the kind of income they have, that there are people who don't have "mummy and daddy" to inherit from, or pay their way, that it's not "old.money". I used to work for the NHS recruiting junior doctors, and a huge swathe of those we interviewed weren't from fancy schools, or Cambridge educated etc.

The attitude of "well, you have expensive stuff and a good wage, so you should help pay off the nation's debt" is very short sighted. The consultant who ran up thousands upon thousands of training debt to be a doctor, finally paid it off, and now works 50+ hour weeks but hapoens to own a home over 500k, they should be expected to foot the governments bills? They should be vilified for having money now? Where does it stop?

Well as you say, "you just do you" and don't worry about it.

They really ought to exclude principal residences. £500k sounds like wealth, but in London suburbs it just means you and your family have managed to live in a run-down 2-bed terrace with rising damp, dangerous electrics and a leaking roof.

and all through saving from low-paid jobs - not through gifts or inheritances

@ZippedyDooDa

They really ought to exclude principal residences. £500k sounds like wealth, but in London suburbs it just means you and your family have managed to live in a run-down 2-bed terrace with rising damp, dangerous electrics and a leaking roof.

Yes exactly. It's so expensive and wages are rubbish

Good. Too much inequality in this country. Too many people comfortably enjoying furlough in their nice house with garden and crowing about well they are coping with the pandemic...Only fair they contribute to the national effort to rebuild.

The attitude of "well, you have expensive stuff and a good wage, so you should help pay off the nation's debt" is very short sighted. The consultant who ran up thousands upon thousands of training debt to be a doctor, finally paid it off, and now works 50+ hour weeks but hapoens to own a home over 500k, they should be expected to foot the governments bills? They should be vilified for having money now? Where does it stop?

How interesting that you see being taxed as being vilified.

If the richest in society- and you can talk all you like about their hard work, it doesn't change the fact that the systems that enabled their hard work to result in riches weren't built and are not maintained by them personally and no matter how much they believe it was all down to them, it wasn't- aren't asked to pay the bulk of the costs of said society, who on earth should be?

Too much inequality in this country. Too many people comfortably enjoying furlough in their nice house with garden and crowing about well they are coping with the pandemic

Are you that stupid? Tell that to my suicidal friend trapped in her flat alone, or my.other friend parenting her four kids in a 2 bed flat, wondering if she'll even have a company to back to. Why are people so stupid as to assume.just because people are on furlough they have a garden and luxury??! Fuck.me.

Of course I pay tax, but when almost half your income is taken as tax can you see why the thought of paying yet more gets annoying?

There is an easy solution to this 'problem'. Leave your high salary job and take one paying half as much. Then you can live without the annoyance of paying so much tax.

@ElectraBlue

Good. Too much inequality in this country. Too many people comfortably enjoying furlough in their nice house with garden and crowing about well they are coping with the pandemic...Only fair they contribute to the national effort to rebuild.

I'm not furloughed so have always been working

How interesting that you see being taxed as being vilified

No. I see being taxed what they're proposing to pay for the Government's decisions on TOP of current tax wrong. What about Amazon? What about the huge companies who pay next to nothing in tax? Why go after our doctors to pay for it all? Etc

@YouJustDoYou

How interesting that you see being taxed as being vilified

No. I see being taxed what they're proposing to pay for the Government's decisions on TOP of current tax wrong. What about Amazon? What about the huge companies who pay next to nothing in tax? Why go after our doctors to pay for it all? Etc

They need to impose a windfall tax on all the companies the have done well from this pandemic. But we all have to pay. My lockdown is very privileged, I need to pay my share.

We would be very close to being caught by this, due to the value of our house and the way pensions are usually valued (20 times expected annual pension amount, I think), but a 5% tax (£50k on £1 million) is double our household after tax income. Given that we cant access our pensions, and can't afford a mortgage due to our income, we'd have to sell the house. We have no spare bedrooms so can't downsize, unless by moving to a cheaper area. And that would cost us stamp duty/moving fees too. I would be very worried if this came in.

@Wotsitsarecheesy

We would be very close to being caught by this, due to the value of our house and the way pensions are usually valued (20 times expected annual pension amount, I think), but a 5% tax (£50k on £1 million) is double our household after tax income. Given that we cant access our pensions, and can't afford a mortgage due to our income, we'd have to sell the house. We have no spare bedrooms so can't downsize, unless by moving to a cheaper area. And that would cost us stamp duty/moving fees too. I would be very worried if this came in.

You would only have to pay on the bit over the threshold of £1million not the whole lot, we are very close also because of pensions, house is just average price but we could tip over in the future.

If the richest in society- and you can talk all you like about their hard work, it doesn't change the fact that the systems that enabled their hard work to result in riches weren't built and are not maintained by them personally and no matter how much they believe it was all down to them, it wasn't- aren't asked to pay the bulk of the costs of said society, who on earth should be?

Will the super-rich not use these systems to find legal loopholes, and simply employ multiple lawyers or squirrel their wealth away in off-shore banks to avoid further tax demands?

People on high incomes already pay a lot of extra tax on their income, in addition to council tax, inheritance tax, stamp duty etc.

In some parts of the country, owning a small house or flat would make someone liable for this extra tax. Why target higher earners further by making them pay tax on the value of their assets as well as their incomes? It’s like penalising people for studying, working and saving.

Sure they could leave their high paid job, take a lower paid one (or not work) and rely on the benefits system to top up their income, but that won’t help the economy either will it? Well paid jobs often come with high stress, long hours and lots of responsibility. Do we want people leaving these jobs as they feel it’s not worth it? Tax people too much and there’s less incentive to progress in their careers.

Suppose some families fritter their income away on lots of holidays, designer clothes, spa breaks; why should they pay less tax than families who saved money or invested in property for their children’s futures?

@JayAlfredPrufrock

Our house is probably worth about £650k. I’d have to sell it to pay a bill like that.

If you could sellit of course And not everyone can get a mortgage or more money on-it. 500k without their main house would be fairer

@VinylDetective I disagree. We are spending huge amounts of money because the government first of all tried to destabilise the NHS even before the pandemic was heard of, they didn't make preparations for this inevitable scenario, despite top scientists telling them it was very likely, and even after it all happened, they didn't listen to the scientists, didn't look at what more successful countries have done, and at every opportunity they have stalled their decisions so that the horse has bolted every time. They ARE responsible for billions, even though yes it would have been costly anyway. But nowhere near this costly.

This is all a crazy scenario. At the moment the housing market is doing well and putting money into the economy - imagine how it would be if so many people tried to sell their £500K+ houses at once, at the same time as other people trying to avoid buying those same houses. I really think it's a ridiculous idea.

@HikeForward "Will the super-rich not use these systems to find legal loopholes, and simply employ multiple lawyers or squirrel their wealth away in off-shore banks to avoid further tax demands? "

No doubt they will try. Nobody has yet told me how they will squirrel away their grouse moor, their castle, their country estate, and their Kensington Palace Gardens mansion, and move them to Switzerland.

Pensions are already taxable if you cash them in.

[quote PigletJohn]@HikeForward "Will the super-rich not use these systems to find legal loopholes, and simply employ multiple lawyers or squirrel their wealth away in off-shore banks to avoid further tax demands? "

No doubt they will try. Nobody has yet told me how they will squirrel away their grouse moor, their castle, their country estate, and their Kensington Palace Gardens mansion, and move them to Switzerland.

Pensions are already taxable if you cash them in.[/quote]
It’s really easy to move properly under the ownership of trusts, companies or individuals based offshore so don’t think you actually have to move the physical asset.

So I agree with those saying it’s unworkable, politically bad, and would impact middle earners/asset holders

And it’d be awful to raid everyone’s pension when we’re being encouraged to save (and yes, counter productive as someone else explained)