To ask what you'll be doing to avoid the Labour tax hikes

[OptimismvsRealism]

Pension contributions
Gift aid
Selling my shares now while CGT is relatively low

What really worries me is that all the professionals we actually need to want to be here will just fuck off elsewhere, though.

It's not like we're knee deep in hospital doctors.

Honestly you have no clue.

Look up funding for lending.

Do you think "Help to Buy" otherwise known as "Help to Make the Unaffordable Affordable" or "Help to Keep House Builders Profits High" were not market interventions ?

Did you know Tony Blair built fewer council houses during his entire term than Thatcher, the so called Destructor of Council Housing built during one year of her premiership ?

The housing market is anything but a capitalist free market. And just as the government can make house prices rise, it can also make them fall. The reason prices don't collapse is because the government(s) keep intervening to stop them collapsing.

I agree the case re boomers houses is relatively interesting. Especially those that live in large poorly maintained energy inefficient housing. Those houses may well turn out to be a lot less valuable than their owners thought.

The problem is council tax has to be in some way related to the revenue the council needs - or at least you would hope it should be.

I think there should be a a property tax, but it should be on top of council tax and probably implemented on a basis of scaling with time to allow people to adjust.

Maybe 0.1% per year to a max of X.

There would be one hell of a lot of squealing though.

You won’t be paying more tax for a fairer or better society. They’ve already said they’re addressing a short fall or a black hole. You’ll be paying more tax to basically stand still, not get any better or fairer.

So to stand still, rather than fall to our knees or be dragged under by inequity.

The way we organise our society is really inadequate.

I’d have to sell my house if they did this.

I own an expensive house (relatively) but it’s just a small highly overpriced terrace in London - on which I have an astronomical mortgage.

An extra £10k a year in tax would make it unviable alongside higher mortgage rates and high childcare costs.

The point is you shouldn't have an astronomical mortgage.

It's only by successive governments allowing huge imbalances in the economy that it has got to this state - roughly since John Major left government.

Those imbalances have gotten so huge that it is going to be incredibly painful for a lot of people for them to be corrected.

And so successive governments have continually stopped them being corrected. And they have got progressively worse. And now we are where we are now.

Is this the point the plates stop spinning ? I don't know. They've certainly managed to keep them spinning a lot longer than I thought they would.

There is stuff in the press today that the South East should pay for the NE and Midlands etc, even more.
The counter argument given all the families exiting London, en masse, is that taxation should be subject to local cost of living. So less taxes in London to account for housing costs!

I am going to start campaigning for London to become its own country, anyone care to join?

Essentially, we have had a change of Government so all the nut cases with their nutty demands are coming out of the woodworks.

No, I shouldn’t.

But giving most of London a new £10k a year tax bill as of Nov 1st would be an extraordinary move.

And - those who own outright might be able to cover it, it’s those with mortgages who would really struggle.

I also can’t see it doing much about house prices when so many people own their homes outright - and there is still a huge shortage of housing.

And it particularly penalises people where house prices are very high, and people are probably already struggling to afford housing.

Its a problem that prices in some areas are so detached from salaries and so vastly higher than elsewhere in the country - but I’m not sure the solution is to charge the people who live in those areas even more tax, particularly when they might just be renting / have a huge mortgage to service. It is not the same as sitting on a huge amount of unearned equity growth.

@MidnightPatrol - it is not going to happen. They do not have any manpower in HMRC to deal with new taxes.

Yes please do this. It has very little in common with the rest of the country now most ordinary folk have been pushed out.

Banking shares already fell sharply yesterday, there is no way they can destabilise the mortgage sector by imposing huge tax hikes on already overleveraged borrowers. Unless they want to be worse than Liz Truss.

All that is going to happen is that they will get not much done, get bullied by the press, backtrack on WFA, spend 18 months blaming the Tories etc - and on and on the cycle continues.

Labour have ruled out CT reform, rest easy with the constant 5% annual rises, expect this to increase.

CT is unsustainable.

That's the problem with more taxation. Everyone thinks it is someone else who is "rich" and should be taxed more.

Personally I don't think it will happen, even though it should. Property taxes are not something crazy or unusual. They happen in a lot of countries. It's just another method of taxation. Quite a good one IMO because they are very hard to avoid (try not paying your council tax) and there is already infrastructure in place to charge them (council tax). There does need to be some transition though to smooth the impact and give people chance to re-adjust.

I have lost hope though that the government, either this one or any other will make the necessary changes. The political will just isn't there, and there is too much VI amongst politicians to make it happen.

The changes will come though in asset prices at least because markets cannot defy gravity forever. At some point in the future, who knows when, the government will not be able to intervene because asset price corrections will be caused by international market forces. At this point though the correction will be spectacular. Expect plenty of comments along the lines of "no one could have forseen" and "It started in (insert random country here)".

Here you go: https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/housepriceindex/december2023#:~:text=The%20average%20UK%20house%20price,to%20£190%2C000%20(3.3%25).
Check out the split by region. This is another source that supports the same data: www.twindig.com/average-house-prices-uk

I’ll sign up - DM me your GoFundMe!

The housing market is anything but a capitalist free market.

What is it then?

I agree the case re boomers houses is relatively interesting. Especially those that live in large poorly maintained energy inefficient housing. Those houses may well turn out to be a lot less valuable than their owners thought.

Their current owners won’t care because they’ll be dead. Whatever they’re sold for will be an unearned windfall for the people who inherit them.

Either both are wrong or neither - which is it?

This literally proves nothing except house prices are more expensive some places and cheaper in other places. Your original point was prices in the South East prop up prices everywhere else and you can’t prove that. We all know house prices are more expensive in the SE. That doesn’t mean it has any impact on the property market in other parts of the country.

Both are absolutely wrong have you read anything I have posted on this thread. Jesus this is hard work.

@GasPanic yes…

And while it does seem unfair that some people have got huge unearned gains within their primary residence - I’m not sure how realistic a very high tax on these households while living there is (on effectively unrealised gains).

I’m surrounded by older people living in expensive (but still quite modest) houses that there’s 0% chance they could afford this kind of tax on. It would be most of their income in many cases!

I think that’s why the focus on IHT - it’s a transfer which makes it easier to target / you aren’t actually turfing people out of their homes.

Yes - the expensive areas represent the top of the market, everything else is priced behind this - with the top end driving up/down prices. So for example someone who grew up in chelsea can’t afford to buy locally, so they move to Battersea, thus pushing up prices in the area they move to. This cascade effect is what holds up the property market. Which is why when central London falls, economists suggest falls across the UK. Some areas out perform the market, but that is the basic concept. Edinburgh for example would be more expensive than Aberdeen and so on.

If they actually want people to pay IHT, it should be a flat 10% for all above 50,000k estate. Then people will actually pay it. Allow spouses to stay in the house, cancel all exemptions/gifts etc within 7 years etc. Make it really simple.

All the research has always shown that flat low taxes for all actually lead to more take.

That’s actually a genuinely good idea.

Not everyone. I earn £85k, OH earns about £32k, and I've been waiting and ready to be taxed more for about 5 years now, because that's what the country needs - I'm totally happy to pay more tax, if it's going to be spent on public services and not going to go up the noses of the Cabinet's buddies. There was zero chance of that happening with the last government's cronyism, there's a reasonable chance of it happening with this one.

Almost all the people I know on similar money have similar thoughts on the matter. There's only one exception, who earns more than me but is so burdened by debts run up by his wife that he has a couple of hundred quid left at the end of the month with the insane jump in mortgages (thanks, Liz) - while I'm comfortable losing £200-250/month, it would absolutely cripple him.

I suspect there are an uncomfortable number of people who'd also be in his position.