Lib Dems ask wealthy to bear burden by doubling ‘mansion tax’ on £2million-plus homes

By
Daily Mail Reporter
Last updated at 12:05 PM on 30th November 2009

The Liberal Democrats are to double the rate of their controversial ‘mansion tax‘ but impose it on fewer properties, the party announced today in a damage limitation exercise.Economics spokesman Vince Cable caused uproar, not least among colleagues he failed to consult properly, when he announced the 0.5 per cent levy on all £1 million-plus homes in September.The measure was designed to pay for income tax cuts for most people but raised concerns over the impact on people living in areas with high property prices.Party leader Nick Clegg responded today by saying the value
threshold would be raised to £2 million-plus - taking up to 180,000
homes out of the equation.The remaining 70-80,000 properties
will be hit with a 1 per cent annual levy on the value, which is
calculated to increase the income from the measure by nearly half to
£1.7 billion.According to party figures, the average price of
all the properties which would now face the bill for the income tax
cuts is £4.4 million.Lib Dem leader Nick Clegg said that it was right that people who could afford more should help fund tax breaks for those who need then. Vince Cable, right, came under fire when he announced the policy earlier this yearMr Clegg said it was right that ‘those with the broadest shoulders’ should be asked to foot the bill for tax breaks for people who needed them and said the party’s proposals were ‘the most radical, far reaching tax reform in a generation’.Under the plans, to be detailed at a London event today, the property levy would help pay to take around four million low-paid workers and pensioners out of paying income tax altogether by raising the income tax threshold to £10,000 - also meaning a £700 cut for most workers.The property levy is designed as a temporary measure until the party was able to implement its plans to scrap council tax and replace it with a local income tax.Mr Clegg said: ‘If you want to know how committed a government is to fairness then look at its tax system.’Gordon Brown has created a tax regime that forces some of the lowest earners in society to pay hundreds of pounds in tax they can’t afford, while polluters and rich tax dodgers avoid paying their fair share.’Meanwhile the Conservatives want tax cuts for millionaires, but say there might be tax rises for everyone else.’Under our plans people won’t pay a penny on the first £10,000 they earn. That would put £700 back in the pockets of the vast majority of tax payers, and take millions of people on low pay out of paying income tax altogether.’Our plans represent the most radical, far reaching tax reform in a generation.’They embody everything the Liberal Democrats stand for: fairness; protecting the environment; rewarding hard work.’It is right to ask those with the broadest shoulders to bear a little more of the burden so that millions of people on normal earnings get the break they desperately need.’Mr Cable, normally a favourite among Liberal Democrats, came under fire after some frontbenchers were apparently kept in the dark about the proposal before it was announced at the party’s annual conference in Bournemouth in September.’We’ve had quite a robust argument. We have a democratic party and despite what’s been said I’m not Stalin,’ Mr Cable said in the aftermath of the row.’We could have had more consultation on the detail but we had discussed the broad principle before - it is about making the tax system fairer.’Asked about the change in the mansion tax threshold, Mr Clegg said that what had been agreed in September was ‘the principle’ of the idea.’Both Vince and I launched this plan at our conference,’ he told BBC Radio 4’s Today programme.’Subsequently we’ve looked at it, we’ve refined it, we’ve fleshed it out.’He said the shift would increase the revenue that the new tax would raise, adding: ‘I don’t think what’s interesting is the process by which this policy was arrived at. What is important is, what does this policy do.’Mr Clegg said that the package would leave more money in the pockets of the majority of taxpayers.’It is an impeccably liberal package based on the idea that if you work, if you work hard, if you take initiative, you are rewarded. It does bear down on unearned wealth.’He said the plans were ‘completely different’ to those set out by both the Tories and Labour.’Our approach, our philosophy is completely different,’ he insisted.

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thought cable had a little common-sense once now that thought has blown out of the water,how longer must hard workers who improve their income through graft and toil keep paying more and more in extra taxes just to keep many leeches of this country in comfort for doing nothing? soon the source of these taxes will be no more then what who will they tax then?a fair tax and a fair wage for all will improve life for many that are prepared to work those that do not should not expect to live on the sweat of others unless their circumstance can prove they need help then help they shall get,but the bums that expect money and comfort for doing nowt get sod all they must understand you get nowt for owt work and be paid but slumber and you go under time for a change.
- stamford, london,england, 30/11/2009 18:42

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Graeme Carter London,
You say that because you can afford it, you wouldn’t mind paying the mansion tax? That statement my friend tells me you don’t live in a 2 million pound plus house and that you couldn’t afford to pay the tax. Because if you really could, you sure as hell would mind paying 20 thousand a year more than everyone else to the government just becuase you have an expensive house. It would horrify most high earners to have to be blood sucked in such a nasty manner as they already pay massive amounts of tax as it is. They pay far more than their fair share.
Stop being a walter mitty. We can see right through you.
- Rob Roy McGreggor, UK, 30/11/2009 18:16

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It’s funny how alot of people begrudge the wealthy, Labour are a good example of this. However when Governments have done very badly and mis-managed the economy, and people have spent more than they earn thus getting themselves into alot of debt, who is it everyone turns to for extra help to get us out of that mess?
I’m sure people who are exceptionally well off don’t mind paying a bit extra in tax, but why pick on people who have worked hard and done well for themselves? Houses in certain areas after rising beyond belief over the last 12 years or so do come into this price range, but it doesn’t mean the owners are very well off. The extra tax burden could just push them over the edge and force them to sell up if their morgages payments are high.
But that’s the trouble when times get desperate, they sometimes penalise all the wrong people, including the lower paid.
- Yvonne, West Midlands, UK, 30/11/2009 17:07

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Don’t be too confident that the LibDems won’t be in a position to implement their policies. If the Conservatives continue with their pre-election gaffes, we could see a hung Parliament and the LibDems are the obvious choice for coallition government. As Vince Cable is the only member of parliament with a sensible contribution to make on the economy - including taxation - what he has to say post-election may well shape the future. I’m no LibDem (mind you, I’m no tory or labour supporter either) but Vince Cable’s abilities to grasp the economic needs of the nation shine through an otherwise muddled and gimmick-ridden strategy of the government and the opposition.
- David Douglas, Chatton Alnwick Northumberland, 30/11/2009 16:55

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Take no notice of the Lib Dems, they will not get a chance to run the country
- Priti, Harrow, UK, 30/11/2009 16:46

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Let’s get some facts aired here.
The top 10% earners pay 53% of all income tax received by government
The top 1% earners pay 25% of all income tax received by government.
So, let’s not say that the “rich” don’t pay their way!
Also, there are many people who are asset rich in a £2 million pound house, but not cash rich, particularly older, retired folk.
No. Let’s get this straight. This is just another spiteful tax that will drive the wealth generators of this company onto the shores of another……..
- Duncan, Twickenham, 30/11/2009 16:39

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