Council tax hike on the cards for £1m home owners

homelessskilledworker

http://www.independent.co.uk/news/uk/politics/council-tax-hike-on-the-cards-for-1m-home-owners-8168319.html



Nick Clegg will demand two or three new council tax bands at the top of the scale as an alternative to the Liberal Democrats' favoured mansion tax on homes worth more than £2m, which David Cameron has blocked. The eight bands on which council tax is based in England – from Band A (up to £40,000) to Band H (over £320,000) – have not changed since 1991 even though property prices have risen sharply. This means that all homes worth more than

homelessskilledworker

Nick Clegg is losing credibilty by the day now, much as I dislike his silly idea yesterday announced on the Andrew Marr show of using pension money to help FTB's(support the housing market more like), I am now starting to feel sorry for him.

But I do think we are fast approaching a time when more revenue will come from property owners, and if the Tories have their way it will be on properties far less than £1 million.

Like I heard on Radio 4 yesterday, you might be able to stash millions away in some dodgy tax haven abroad, but you cannot stash your house/s away.

PasturesNew

I've never thought it fair that a tax based on house prices stopped at such a low level. A mansion's council tax is just 3x a mobile home/studio flat in a cheap area.

System

PasturesNew wrote: »

I've never thought it fair that a tax based on house prices stopped at such a low level. A mansion's council tax is just 3x a mobile home/studio flat in a cheap area.

Does a mansion require 3 times more public services than a studio flat?

Fair is an interesting concept when discussing something that's taxed based on what it's worth rather than how much it costs to service it.

CLAPTON

Why has increased house prices anything to do with council tax ?

The 1991 prices were used to apportion council tax charge; why would this ratio need to change just because all house prices have increased.

There is, of course, a logic in introducing new bands at the top so that the charge can be reduced at the bottom as a means of redistibuting income, but it has nothing to do with the general increase in house prices.

kabayiri

CLAPTON wrote: »

...
There is, of course, a logic in introducing new bands at the top so that the charge can be reduced at the bottom as a means of redistibuting income, but it has nothing to do with the general increase in house prices.

Back in 2005/6 the government of the day spent £16m+ on a new system to rerate all properties.

The day after it goes live it gets axed by politicians who panic from the poor media response to the initiative.

So...all the servers, database software, application tiers, load balancers, they all get mothballed.

It would have made sense to continue with the introduction of the 20 bands, but kept the band pricing levels in line with the current rates. That way, there would be more bands in place allowing for more flexibility in terms of extending the scale.

Mind, when do you find sense and politics in the same sentence.

CLAPTON

kabayiri wrote: »

Back in 2005/6 the government of the day spent £16m+ on a new system to rerate all properties.

The day after it goes live it gets axed by politicians who panic from the poor media response to the initiative.

So...all the servers, database software, application tiers, load balancers, they all get mothballed.

It would have made sense to continue with the introduction of the 20 bands, but kept the band pricing levels in line with the current rates. That way, there would be more bands in place allowing for more flexibility in terms of extending the scale.

Mind, when do you find sense and politics in the same sentence.

maybe and maybe not;

if you are looking for a method to tax housing whealth rather an income then council tax may well be suitable

if on the other hand you are looking for a way of funding local services then the logic is not so clear.

Loughton_Monkey

As I understand it, Osbourne has another £10 billion to find. He can get it by freezing some of the benefits. Libdems have "promised" to block this, preferring to get the £10 billion by 'soaking the rich'.

A compromise will be engineered, whereby benefits are [partially] frozen, but a bit more tax from the rich will also go into the pot.

What we have here, is Cleggy and Co. desperately trying to think of a 'good wheeze' to raise a few £billion. Income taxes are out of bounds, most other taxes are too 'general', so he's left with some sort of property tax.

olly300

Joeskeppi wrote: »

Does a mansion require 3 times more public services than a studio flat?

Fair is an interesting concept when discussing something that's taxed based on what it's worth rather than how much it costs to service it.

It's can be presumed that more people can occupy the mansion than the studio flat.

I've also yet to meet someone who lives in a very large house who doesn't have some form of domestic and gardening help.

CLAPTON

olly300 wrote: »

It's can be presumed that more people can occupy the mansion than the studio flat.

I've also yet to meet someone who lives in a very large house who doesn't have some form of domestic and gardening help.

I thought the issue was PRICE/Value of the property and not it's size.

A million pound property in London may be a two bed flat without a butler.

Carl31

CLAPTON wrote: »

I thought the issue was PRICE/Value of the property and not it's size.

A million pound property in London may be a two bed flat without a butler.

There was a story a few months back about a couple that had a pretty standard 3 bed in london, that due to location, had risen in value to something like £2m. The occupants were a couple with 2 kids, if i remember correctly, no more a drain on council services than any other family
Admittedly, it was in the Daily Mail, so could be questionable in terms of the truth, but this could be an example of the point you are making