Latest mansion tax should be on top % homes locally not nationallu

[Lionfisher]

Rachel Reeves is front running yet another class warfare policy in the press, this time suggesting everyone who lives in a home over £2m should have to pay 1% on anything above 2m.

First - I’m fine with this. I live in SW London and would probably have to pay some.

But I’m ONLY fine with it if everyone round the country does too. Meaning that it should be on the top 5% of homes by REGION (I’ll leave it to other people to argue what region means, all the data is there to do it).

We could happily sell our 4 bed home and move somewhere else in the country and buy a 10 bed castle. Or just buy another 4 bed home and stash the rest in the markets. TBH we might even do that if this comes in.

But people don’t want us to do this because it prices them out of local homes etc. Which is pretty much what this policy would do, price people out of local homes so they move elsewhere and prices up somewhere else instead.

But more than anything you can be far more rich on far less money in other parts of the country. So this isn’t a tax on property it’s a tax on the south.

As long as top X% of homeowners elsewhere are paying their 1% above their threshold I’ve no issues with this.

But people won’t agree with me as it’s easier to think it should always be “other people” who pay…. or will they?

So how would you do it?

People over 60 account for 33% of Pip claims. Retirement age was still lowish under Blair and Brown.

Also Long Covid now exists which wasn’t a thing then.

Cut all welfare benefits by 10%. The compound benefit to get to a higher overall saving will come from some of those people deciding that work is more attractive. The constant benefit increases the government gives are inflationary and self defeating. This would still be considerably more benefit per person than under New Labour.

The core driver of the cost of living crisis is housing pressure. I'd reduce the level of immigration which would reduce housing cost. I'd reduce it back to the levels seen under New Labour.

I'm not really sure what the point in responding to you is. You post the same types of question all the time but never seem to learn.

Agree
@BIossomtoes Trapping people on benefits is waste. Supporting them into work isn’t. Labour does a lot of the former and very little of the latter. The also don't have any coherent pension policies. No Government has from what I can see.

Quadruple-taxing ordinary people for owning one home, not hoarding wealth or any other gaslighting nonsense, isn’t progressive. Income tax to earn it, stamp duty to buy it, council tax to live in it and now an effective mansion tax on top of this based on a made up value, not earnings or ability to pay. Its been mooted you can owe it until you sell with interest charged for the privilege...

It isn’t making the broadest shoulders pay more either, Labour won’t touch them. It will trickle down, snaring more homeowners, pushing up rents and inflating starter and second-step prices. Lets see who is still smug then.

So yes, its waste. If fact, I would go so far as to say that Labour has a PhD in waste and gaslighting.

TLDR: Mansion tax is asset-based extortion of ordinary workers and older people who’ve lived in their homes for 20+ years - to fund waste.

The problem is if I sit on a 2 million mansion I am costing the Government. Because if I lived in a 1 million one instead and put another 1 million into savings, I would have to pay tax on those savings and with current returns of 4 per cent plus, the Government would make more money out of me. So partly it is to disincentivise people from investing all they have into property and potentially put it in savings? The Government is desperate to pay down the sovereign debt. They are stinging people for every bit they possibly can. Councils are broke and have installed cameras everywhere too. First round of appeals are being rejected like they are for SEND places.
Government has turned into a money grabbing business too. It is what it is. Hence people do and can adjust their behaviour both the rich and the poor are doing it.

Ordinary people don’t live in £2 million homes. We need to spend more on defence and healthcare, the money has to come from somewhere. And this quadruple tax nonsense is ridiculous - every cost of putting a roof over your head is paid from money already taxed, whether you buy or rent.

People in London and the SE are being screwed to subsidise everyone else (who have similar incomes and lifestyle to them). That's unfair and bad taxation.

Where do you think the money has to come from?

Mansion tax won't bring in much.

It’s obvious that the money has to come from increased taxes. The trouble is that everyone thinks they shouldn’t have to pay it.

Who do you think needs to be paying the increased tax?

Yes agree

All of us according to our means.

What a nonsense idea. There are more and less expensive properties in every area, even the most deprived. There’s always a top 10% in terms of housing prices in an area (and a bottom 10%), just as there’s always a tallest 10% (and a shortest 10%) in any group of people. So this policy would just result in some people on very low incomes, in poor areas, paying extra tax - when they are far worse off than others not paying this ‘extra tax’ elsewhere.

This would be cruel & unfair, of course- but is presumably what the OP wants. (And its very cruelty and unfairness might make it highly attractive to Starmer and his horrible clique, so maybe in fact it’s a winner!)

What this silly idea does reveal though is how inefficient a tax on real property is. It takes property as a proxy for wealth, & that is simply not always effective. (And certainly is not effective if you proceed on the basis the OP suggests.)

A wealth tax should look at absolute (not relative) wealth - the net value of all investments and assets, not just property. Spoiler: the people living in the more expensive houses in Merthyr Tydfil would not be paying a wealth tax calculated on this basis.

What does that mean?

Exactly what it says. It’s hardly ambiguous and doesn’t contain any words of more than three syllables.

But that would simply mean boomers wouldn't downsize.

I'm 62, I have a house and in 5 years I will retire. Ds will probably have moved on by then. My house is nowhere near mansion tax level or the top 5% but buying a 3 bed cottage where I live will probably cost more than £30k in stamp duty. The temptation to stay where I am is already strong..

Maybe you meant 'Jeder nach seinen Fähigkeiten, jedem nach seinem Bedürfnissen' but got distracted with cheap insults?

I meant what I said. Go and goad someone else.

Goad?

I asked nicely, you tried to insult me, and somehow that's my fault?

Reality is nobody contributes their talents fully without financial reward for themselves being greater than that to society. That is the Laffer curve, innit.

Society is essentially an abstract noun. People are more incentivised to pay in a contribution based system and that is where we are going wrong in Britain. It has to be made more concrete to the individual. Like pay shedloads of tax be guaranteed a pension or unemployment benefits when out of work or sickness benefit tied to salary. Like they do in several other countries.

Yes the SD is an absolute ripoff

MIL would like to downsize but she resents having to give a huge chunk of money to the government for this “privilege”

@Lanva
You will have to, because if we don't fix inequality this country will turn into Mexico, or South Africa, or Brazil. That's what happens to countries with no meaningful middle class. We all need to grow up a bit. We are in serious trouble.

Do you mean this country will become increasingly lawless and ungovernable? And/or do you mean it will become a financially failed state where services barely or don’t function?

It's so inefficient. Buying a house costs a full year of salary in tax. A full year working for nothing: just handed over to the government in addition to the actual price of the house.

Which means that once you've settled in your family home, you can never move again. Even if a great job comes up on the opposite side of London - and your spouse works in central London, so you could just move for the job without serious disruption. Even with a 20-30% payrise, it would take 3-5 years to break even after paying the tax penalty.

So people jusr don't. Don't do the higher value work they've been offered. Don't pay that extra income tax. Don't create that extra growth in the UK.

What a waste.

Yes it is such a lot of money so why should they expect even more from those in higher value properties