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Anorak | Well Done Ed Miliband! A New Tax That Raises No Revenue!

Well Done Ed Miliband! A New Tax That Raises No Revenue!

by | 26th, September 2014

This is a quite lovely political manouevre by Ed Miliband. He’s managed to find a way of making the rich pay more taxes without the Treasury actually having any more money to spend on the things we generally like to get from taxes. It’s this new mansion ta that he’s decided to have. Have a house worth more than £2 million and you have to pay an annual tax on that value. Not, on the face of it, actually a terrible idea. It’s what happens next that’s the problem :

Labour’s £1.2billion-a-year mansion tax haul could be virtually wiped out by plunging stamp duty, inheritance tax and running costs, experts warned last night.

Many prospective buyers desperate to avoid a new annual one per cent tax on properties worth more than £2million would lower their offers, research suggests.

Meanwhile, sellers wary of trying to market homes burdened with the mansion tax would be more likely to price them lower.

Even a 10 per cent fall in the value of properties priced £2million or more would trigger a £500million slump in tax receipts for stamp duty and death duties, analysis by estate agent Savills shows.

And when the annual cost of running a new valuation department is added to the money needed to pay owners’ appeal bills, the anticipated £1.2billion gain could be lost.

Now some of that could obviously be the

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Posted: 26th, September 2014 | In: Money Comment | Follow the Comments on our RSS feed: RSS 2.0 | TrackBack | Permalink