General Chat

Is that fair?

Just because you live in a house valued at £2 million, it doesn't always mean that those that live in it have excess money.

Bedroom tax. If they can charge people claiming housing benefit for any extra bedrooms they have, even if that family is willing to downsize but there isn't a property to downsize to, then they can charge those who can afford to buy £2 million houses.

Surely those who buy £2 million homes have already paid tax in one form or another. They will have paid stamp duty for starters plus they will pay a high rate of council tax so why should they pay more?

Because they can afford to.

To be honest, I don't know how it would work. Is it supposed to be an additional annual tax or what?

During the course of googling....

http://www.cps.org.uk/publications/reports/taxing-mansions-the-taxation-of-high-
value-residential-property/

Centre for Policy Studies (centre-right think tank)

"it would unfairly target the income poor, equity rich (31% of properties in London worth over £2 million have been in the same ownership for over 10 years, 15% over 20 years. Price growth has been +89% in the past 10 years and 426% in the past 20 years)"

Which agrees with Lynda's asset rich/cash poor point of view

Larger houses already pay higher council tax and when sold stamp duty. Tinker with those if necessary.

No.
A tax which takes no account of ability to pay cannot be fair.

And the location has a great bearing on the value of a property. A two bedroom flat in Mayfair occupied by a widow may be worth £2million whereas a ten bedroom mansion in Yorkshire occupied by a tycoon may be worth less than half that.

Well they can always downsize ;-)

A number of owner/occupiers might well love the chance (to downsize) if only they could find someone to buy it!

Why should people with more assets and money have to pay more tax? Taxation is relative surely.
And I agree with the asset rich/cash poor point of view as stated above.
Plus, a £2 million property in, say, the home counties will be somewhat different compared to a similarly valued property in, for example, Yorkshire.

No I don't think it's fair. I agree with Lynda re the asset rich income poor possibility..especially in London.

Folk who knock themselves out to buy their home pay bucket loads of tax many times over for the *privilege...it should be based on income not property prices.

Someone who lives in a £2 million house, could of brought it yonks ago, and not paid anything like that, and just happened to live in an area that has rocketed, and because they have stayed in the same house, it may not mean they have an excessive amount of money.
As an instance the house I Iived in is now worth £1. 500 million, had I still lived there I would only be worth what I am now. The house you live in may not necessarily match your bank balance.

perhaps to exclude those who are property rich but asset poor ( stately homes, inherited property etc ) I would say all new purchases should be taxed at the higher rate ( which would impact on oil sheiks purchasing a London 'pied a terre' lol) but make all currently owned properties exempt, and the resident's tax based on income.

not sure.

I looked at a property nearby the other day that was £80,000. Two bedrooms, loads of character, excellent view, decentish condition and very nice area. You couldn't even buy a garage in London for that. So surely any suggestions of taxation on a property of a certain value have to take into account the total disparity of values from area to area.

For people unfamiliar with London property prices, have a scan of this

http://www.londonpropertywatch.co.uk/avg_prices.html

They have always had a tax for mansions just as they have for bedrooms

Its called the council tax

The amount of Council Tax depends on how much money the Council needs in order to pay for the services which it will provide in the next financial year

Tax Band,
Tax band was worked out based on value of the property of which the number of bedrooms is taken into account this accounts for 50% of your council tax

Number of adult occupants,
1 adults, 25% per adult up to a maximum of 2 adults making 2 adults 50% of the cost of your council tax

That's why a single adult gets a 25% discount,


Roy

Don't think it's particularly fair, and I agree with Muffy, tax should be related to income.

My family house was brought in 1958 for £7,000, which my Granddad paid in cash, taking it across the Road in a holdall. The people who sold the house to us, brought a new house, which wasn't ready when we were to move in, so we all lived in the house together for a few weeks, until the new house was ready, how friendly was that :-D

Another thing, I have no idea why it's called a mansion tax if a house /flat is worth over £2 million, I never lived in a mansion, nor do others I know who have houses worth £2 million, it's just there home.

well quite frankly I have no idea how I am going to pay more tax :-D :-D

You have to cut back from butter to marg Ann......I agree with Muffy and Lynda on this why should they have to down size :-D