Enter any UK “mansion tax”?

The closer parliamentary elections are, the louder the debate about the introduction of a tax on mansions are more expensive than £2 million

Shadow Cabinet of the British Parliament joined the opposition labour party, which is the initiator of the bill and opposes the introduction of a mansion tax. Members of the shadow Cabinet believe that the tax will place a heavy burden on many people living in London and the South East of England.

If the Labour party wins the upcoming election in may 2015, a very high probability that the tax will still be introduced so that the received funds be spent on health.

The labour party promise a gradual introduction of a new tax to the extent that what will be the rate of inflation. And of course, the tax rate will vary depending on the price of the house.

The billionaire who owns the penthouse for £140 million will have to pay more than the owner of a small family house by the sea.

The labour party has not yet announced the amount of tax which the budget will be replenished, in the case that the tax will be introduced. But a ballpark figure voiced by the party of the Liberal Democrats. According to their calculations, around £1.7 billion pounds per year of additional funds will come into the Treasury of the United Kingdom.

The only problem is that the prices of houses and flats in England, especially in the South and London so a shot in recent years that even the owner of a modest house may suddenly discover that his estate became the subject of mansion tax and get a huge bill for taxes.

Indeed, property in London, which cost in 1994 of £500 thousand, now its average cost – £2056381. Every third owner of the property is more expensive than £2 million , live in it for more than 10 years, and every 6 – more than 20 years.

According to the largest property portal Zoopla, around 96 per cent of all taxpayers of the new tax will stay in London and the South East of England, which is about 108000 homeowners. Not all of them are very rich. The average tax burden will fall on each homeowner will amount to approximately £15,000 pounds a year.

Approximately £1.6 billion will bring to the Treasury a tax on mansions, assembled in London and the South of England, and only 4% sales tax will be collected in the rest of the UK, which in absolute terms amount to about £66 million

Opponents of the introduction of the mansion tax argue that the tax could greatly harm the international reputation of London in the eyes of foreign investors as a city attractive for business and investment. In addition, such a measure may have a significant inhibitory effect on the market, which are already lacking working capital for continuous growth. The effect of these measures may have an impact in the lower price sector, where lack of funds will lead to the freezing of construction and the processes of stagnation in the market.

The pessimistic attitude towards the introduction of a mansion tax is based on the following thoughts: “the Regions of the UK only have felt a positive shift in the market, experienced a ripple effect from the sharp rise in property prices in London. If now to “pull the plug”, the negative processes in the real estate market can become irreversible.

® Helen Antre 23.09.2014 g.

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