Vince Cable is a national political phenomenon being listened to for his wisdom on the current economic tribulations by everyone, whatever their political allegiance. He must single-handedly account for a large proportion of the opinion poll ratings for the Lib-Dems. Last week he slipped out a ‘mansion tax’ policy in a package that showed an important sense of fairness. [Article here]
It is aimed at home owners in the £1m plus bracket (0.5% tax) and would be linked with cutting anyone earning under £10,000 out of income tax altogether.
Top journalist at the Financial Times MartinWolf [Article here]
agrees with Cable and says property taxes are ‘economically desirable’ and the best such is on ‘site value rather than on completed development’. That is: Tax the land not the building.
Matthew Parris, Tory, of The Times is scared by the idea,
‘That’s my home. Get your dirty tax hands off it’ [Article here] because it brings him a feeling of personal insecurity. However he admits ‘Property Taxes are in fact as fair as any tax on earth’.
I think Vince Cable has won for the Lib-Dems on this one. Politically it draws attention negatively to the Tories’ protection of ‘mansions’ up to £1m in value from inheritance tax and strengthens a Lib-Dem ‘fairness’ theme. The Tories launched their idea in October 2007 at the very top of the property market and boosted their poll ratings by it. Politicians beware of the 18 years property cycle! The number of voters owning a home approaching £1m in value has dropped drastically since. See elsewhere in this blog for this, look for ‘Fred Harrison’. Read The Free Lunch - Fairness with Freedom for many ideas for a fairer society.