Balls adds mansion tax pledge to speech

Shadow Chancellor Ed Balls added to the pre-released text of his speech at the Labour conference yesterday by reiterating the party's pledge to introduce a mansion tax on homes valued at £2m and above.

We will levy a tax on the highest value properties over £2m - a mansion tax. We'll do it in a fair, sensible and proportionate way, raising the limit each year in line with average house prices and putting in place protections for those who are asset-rich and cash poor he said.

We'll make sure that properties worth tens of millions of pounds make significantly bigger contributions than those houses that are just above the [£2m] limit.

Because how can it be right that a billionaire overseas buyer this year of a £140m penthouse in Westminster will pay just £26 a week in property tax - the same as the average property tax in that area. We will make different choices he told the party's conference in Manchester.

There will be four levels of mansion tax if Labour wins power next year, used to raise revenue to boost funding for the NHS.

The lowest of the four bands would be for homes valued at £2m to £5m. In a bid to deflect criticism that this would include modest homes owned by people who were not rich - but who had just lived in the same home for a long period, during which it appreciated extensively - Balls says some asset rich, cash poor' may be able to defer payment of the mansion tax until they sell the property, while others may possibly be eligible for tax relief.