mansion tax

[anonymous-user]

walm said:

Greg66 said:

I'm guessing you have neither a family, a house, nor parents/grandparents who might be affected by this proposal. You might view things rather differently were that the case.

Guess again.

Hmm. Think I'll not bother, and just pop you on my "fking lunatic" list instead.

[Du1point8]

walm said:

No one said it would be easy.

And as it turns out they wouldn't have to under the current (never to happen) plan:
http://www.libdems.org.uk/get_the_facts_mansion_ta...

LibDem Propaganda says:
What about pensioners?
Pensioners living in homes over £2m would be able to delay paying the Mansion Tax until their property changed hands.

Ah... so another death tax on the people inheriting the property.

Lovely

[Justayellowbadge]

Not a mansion:



http://search.knightfrank.co.uk/edn130007

[Du1point8]

Justayellowbadge said:

Not a mansion:



http://search.knightfrank.co.uk/edn130007

But this one is:



as its £2.5 million

[Du1point8]

anonymous said:

[redacted]

How about a mansion tax on the way it should be?

The Sq Ft of the property... above a certain amount 8000 sqft and its classed as a mansion.

Nothing to do with this price of the property.

Wonder how many Lib dems have property now valued at £1.9 million

[Justayellowbadge]

anonymous said:

[redacted]

Judging by the flag hanging in the stairwell, looks like a yank's holiday place at present. Someone has been spending a gobsmacking amount keeping it up and are selling for essentially sod all.

As you say, they would be haemorrhaging cash running it.

[DonkeyApple]

London424 said:

Tell that to all the French people that live in London...now I wonder why they moved across the water? Have a guess.

Soap and waiters who aren't pricks?

[audidoody]

What is the reason that many people are living in £2 million "mansions" in London. Answer: house price inflation. And what causes house price inflation? Answer - Government Policy (i.e. fiscal policy, house building programmes - or lack of - etc).

So if the £350,000 house I purchased (through risk taking and hard work) 2o years ago now has a notional value of £2,100,00 does that mean I should be now taxed on the results of inflation caused by government policy? Without any taper relief?

[DonkeyApple]

Greg66 said:

walm said:

"£2m = mansion" is an unfortunate gutter press invention.

I still maintain that whoever lives in that house can probably afford to pay a little more tax.

Certainly they can afford it more easily than the family in Grimsby who happen to live in a house of similar physical characteristics.

I think people are struggling to understand how truly fortunate the guys in Fulham are.

Say as suggested prices are up 20% recently, so that house used to be worth £1.65m.
For doing precisely NO WORK, that house owner has earned £350k - tax free.

If your average wage earner is taking home £20k net - this guy has earned the equivalent of OVER SEVENTEEN YEARS of the average UK residents income - by simply being fortunate enough to live in the right place.

Now of course he has to move house to somewhere smaller to crystalise the gain but still!

Two points:

First, everyone can afford to pay "a little more tax". You can pare anyone's expenditure - no matter how little they earn - down to pure essentials, and assert that anything over that can be paid in tax. However, the Government's role is not to extract every last penny of "surplus" money from the general population.

Secondly, you say that a house owner has "earned" £X by reason of doing absolutely nothing when house prices rise. Bullst. It's a paper profit. If you want to tax that "earning" remove the CGT exemption for principal private residences. Take the money on a sale.

Looked at another way, if you tax a home owner on this notional unrealised earning, are you going to offer a rebate if house prices fall?

It's an interesting area when you look at London where nearly all the target properties are.

A chap in a good job, in his late 30's early 40's and earning 100k back in 2004 would have paid in the region of £500k for a three bedroom dwelling in Zone 2.

Now that property is approaching £2m but the salary is still in the same £100k area. Out of that salary, once taxed, the person must invest 10-20% into a pension, create savings, raise two children and bank roll the wife.

Suddenly a 2% annual tax on the current value of the property comes in. Well that's £40k a year to be found after tax.

Not doable.

The concept does not recognise that because of rampant house price inflation in London that most people living in the targeted properties actually do not have the income to pay such a tax but contribute to the local area immensely.

Same with the pensioners. They won't have the income in many cases.

It is extremely bad to tax British people's primary home in such a way.

[audidoody]

Justayellowbadge said:

Not a mansion:



http://search.knightfrank.co.uk/edn130007

… a mansion

[walm]

anonymous said:

[redacted]

Tonker - like DonkeyApple - I normally find I agree with much of what you write but I really think this is getting way beyond the Well Built Company Director cliche here.

Perhaps it is all to do with the incredible house price inflation in London. I don't know.

But let's put some real numbers to the debate.

I am nearly 40.
Of my friends from uni I have:
A sell side analyst.
A board member of Waitrose.
A "middle manager" at the BBC.
Plenty of barristers.
Plenty of strategy consultants.
A few hedgies.

The only ones from that group who could afford that house are those with family money and perhaps one of the hedgies.

Middle management simply don't get paid £300k nor can they afford a £2m pad in Cobham (from scratch).
Only 1% of tax payers pay the 45% tax.

I was analysing Aggreko the other day and their FD gets £400k basic. That's a FTSE 100 company with £4bn market cap.

[walm]

DonkeyApple said:

Suddenly a 2% annual tax on the current value of the property comes in. Well that's £40k a year to be found after tax.

It's not though.
It's 2% on the value ABOVE £2m. So - zero.
Oh and they were suggesting 1%.

[NomduJour]

walm said:

Perhaps it is all to do with the incredible house price inflation in London.

It is (and SE commuter territory).

[anonymous-user]

Quite. Yet a further problem with this idea is this: the house inspectors tell you your house is worth 2.2m. You decide to sell.

Except no one will buy at 2.2m. The best offer you get is 1.975m.

So what happens then? Can you force the house inspectors to revalue your house out of the mansion tax? Or do you have to move at 1.975m?

And for those who are force to move, is the Govt going to offer SLDT relief on the house they have to buy? Or force them to move to avoid one tax and then trap them into paying another?

[audidoody]

walm said:

"£2m = mansion" is an unfortunate gutter press invention.!

"I want a new ‘mansion tax’ on the most valuable properties – we propose 1% of the value of over £2million. This will be paid by the wealthiest 0.16% of property owners. If you agree, add your name to our campaign now. Unlike taxes on income, it is impossible to dodge a mansion tax. After all, a mansion can’t be hidden offshore" (email from the Business Secretary the Rt Hon Vincent Cable)

[walm]

audidoody said:

walm said:

"£2m = mansion" is an unfortunate gutter press invention.!

"I want a new ‘mansion tax’ on the most valuable properties – we propose 1% of the value of over £2million. This will be paid by the wealthiest 0.16% of property owners. If you agree, add your name to our campaign now. Unlike taxes on income, it is impossible to dodge a mansion tax. After all, a mansion can’t be hidden offshore" (email from the Business Secretary the Rt Hon Vincent Cable)

Ha! Nice. I am suitably busted and chastised.

My only response is that most of what comes out of a politician's mouth is fit for the gutter!

[DonkeyApple]

audidoody said:

Justayellowbadge said:

Not a mansion:



http://search.knightfrank.co.uk/edn130007

… a mansion

Interestingly, I was in that property about a month ago.

It has no garden, no parking, no storage and no proper sized rooms. There must be approaching £1m of premium for being by the Heath.

£4m is about the minimum for a well sized family house and even then it's not going to be a mansion, just a house.

[alock]

Forcing people out of expensive houses has side-effects. We were looking at a new build £500K home a couple of years ago. We basically got gazumped by an old couple who were retiring and down-sizing from their £1M home to free up some equity. The extra £20K ish to out bid us was negligible to them but pushed us over the limit of affordability.

If you are in the market for a £500K to £1M house, the last thing you want is competition from this mythical pensioner forced to sell their £2M family home. You will lose a bidding war.

[DonkeyApple]

alock said:

Forcing people out of expensive houses has side-effects. We were looking at a new build £500K home a couple of years ago. We basically got gazumped by an old couple who were retiring and down-sizing from their £1M home to free up some equity. The extra £20K ish to out bid us was negligible to them but pushed us over the limit of affordability.

If you are in the market for a £500K to £1M house, the last thing you want is competition from this mythical pensioner forced to sell their £2M family home. You will lose a bidding war.

Exactly. There are only a couple of hundred thousand British people who can afford £2m houses. Whereas there are millions of overseas who can and London is very desireable. Pushing Londoners out to the sticks or suburbia is going to impact those already living there and the London properties will go to overseas holders. In short it won't slow house price inflation but quite possibly increase it as demand for sub £2m homes is artificially accelerated or people do what we do and have two homes, one for the working week and one for the weekend.

[will_]

DonkeyApple said:

Exactly. There are only a couple of hundred thousand British people who can afford £2m houses. Whereas there are millions of overseas who can and London is very desireable. Pushing Londoners out to the sticks or suburbia is going to impact those already living there and the London properties will go to overseas holders. In short it won't slow house price inflation but quite possibly increase it as demand for sub £2m homes is artificially accelerated or people do what we do and have two homes, one for the working week and one for the weekend.

And who benefits the most from a house-price boom via increased SDLT, CGT and IHT......