Mansion Tax – a healthy option….?
Critics of Labour’s imposition of a mansion tax on owners of £2m+ properties point to the gap between their assertion that it will raise enough to keep the NHS afloat (£1.2bn) and professional predictions that it will actually only raise ca £140m from properties worth between £2m and £3m – leaving the 5,000 properties estimated to be worth over £3m contributing the remaining £1.08bn!
The threat of Mansion Tax has impacted hard on demand from upper market home finders, who have becoming noticeably more reluctant to purchase properties that could potentially be hit by the charge (their concerns extending to high prices, the medium term prospect of a rise in interest rates and tougher mortgage rules introduced in April to ensure greater affordability).
Critics of the mansion tax policy (amusingly, including Labour mayoral candidates!), have warned that it will tax older people who bought properties decades ago, only to see the values soar.
In order to head off this criticism, Ed Balls has said those earning under £42,000 could defer payment until sale of the property. Hardly reassuring if the NHS is going to be kept afloat in the meantime…..