Agents have reacted angrily to the government contemplating introducing a Mansion Tax, and to the Housing Secretary not ruling out the idea in a TV interview.
Yesterday we reported that a Sunday Telegraph article revealed from two separate sources that a tax of the most expensive homes was being considered both by the Treasury and by Number 10.
Housing Secretary Robert Jenrick then appeared on Sky TV yesterday morning and declined to rule out the possibility of a Mansion Tax.
Estate agent and housing market commentator Russell Quirk took to Twitter to say the move was “Marxist” and commented: “Sorry, did Jeremy Corbyn get in after all?” Later in the day he described the possible measure as “a regressive tax on aspiration if true … astonishing from a Conservative govrernment.”
And buying agent Henry Pryor used social media to link to the Telegraph article and say: “April 1st coming under serious pressure as the day of fools.”
Just over five years ago Boris Johnson was outspoken in his criticism of a Mansion Tax proposal by the then-Labour leader Ed Miliband. Johnson, the London Mayor, called Miliband's idea "a tax on homes" and "a tax on London" and warned that people would be "clobbered by it."
Yesterday even seasoned political commentators appeared in shock at the U-turn, which is being considered as a way of the government raising money to fund major infrastructure work in the Midlands and the north of England.
The FT’s chief political columnist Jim Pickard described it as “an audacious political move given that ‘actual Marxist’ John McDonnell considered it too radical.”
The Sunday Telegraph’s editor, Allister Heath, tweeted: “Boris and [Chancellor] Javid must kill these ridiculous, unconservative tax plans and put the officials proposing them back in their box.”
Here is the Sunday Telegraph article, although for many readers it may be behind a paywall.
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Boris as ever the congenital liar.
Let me see, the creation of an annual tax on wealthy and not so wealthy people who find themselves the owner of properties with a large price tag. Is that a conservative vote winner? or does it sound like an election loser.
Given that the idea was dreamed up over a decade ago by of all people Vince Cable, I am in wonderment why it is rearing its head once more.
Tinkering with stamp duty, taxation on property can seem a great idea, but as I have seen first hand it can have seismic consequences. In 1988, Nigel Lawson said it would be a good idea to limit mortgage relief at source, but gave advance warning. This caused everyone in the UK to pair up and buy property, massive house inflation, and a nuclear winter - property market for many years after. I was actually in agency at the time, and remember it took over a decade for the market to come back.
More recently, we had the introduction of additional stamp duty for buyers, purchasing second or more properties, result - another bun fight to buy before the tax change - then a slower market.
My advice, annually the property industry in the UK is worth collectively 6.5BN, and the chancellor collects around 16BN a year in stamp duty revenue, before changing the level of, or introducing a new way to tax property, perhaps consult the UK real estate industry first.
A mansion tax will just cause many to buy well below any MT threshold.
Those who are asset rich and cash poor may have to sell up or find their property title deeds have MT charges applied for when it is sold.
Govt is coming for property wealth cos that is where the money is.
Best to acquire lower value properties.
Time to evacuate from London for the cheaper hinterlands taking the cash from selling London property.
No point in staying in London if the equity is effectively going to be taxed.
Cashing out now from London now would be a good idea.
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