Lib Dems revise mansion tax
THE Liberal Democrats have doubled the threshold at which they want homeowners to pay an annual “mansion tax”.
Properties will now have to be worth at least £2m to incur a one per cent charge – the previous plan was to charge 0.5 per cent a year on properties worth more than £1m.
Party leader Nick Clegg admitted he had been forced to “do some homework” since announcing the policy in September. Many Lib Dems fear the scheme could damage their election prospects in London and the south of England.
An estimated 80,000 homes would now be hit by the levy, compared to around 240,000 under the previous threshold.
The Royal Institute of Chartered Surveyors warned a mansion tax would be difficult to implement.
Gillian Charlesworth, director of external affairs, said: “Any tax needs to be based on accurate information about who is affected and how much they will be expected to pay. A lack of information means it is not straightforward to even estimate the potential revenues from the scheme.”
The revised “mansion tax” formed part of a range of tax proposals unveiled by the Lib Dems yesterday described by Clegg as the “most radical, far reaching tax reform in a generation.” These include:
• No income tax paid on first £10,000 earned;
• Tax relief on high value pensions reduced;
• One per cent annual “mansion tax” on a property’s value above £2m;
• Capital gains to be taxed as income;
• Ten per cent temporary tax on bank profits;
• More green taxes.