In principal I think most sensible observers would agree that an extension to Council Tax Bands could be an acceptable alternative to a draconian Mansion Tax regime that must be avoided at all costs.
There is nothing wrong with a more expensive property paying a commensurately higher charge for local services (even though paradoxically they use less of them i.e. do not use State Schools or usually the NHS and are certainly not on welfare).
The ‘devil is in the detail’ as long as the resultant extra tax is in proportion to the payments for the bands that already exist, not a punitive desire to redistribute wealth, then this is acceptable.
The uncertainty regarding Mansion Tax is having a very bad effect on sentiment on the upper price brackets of the residential markets that are flat lining at best and in recession at worst.
Lest we forget, the Lib Dem’s Mansion Tax mantra is designed to grandstand for votes not to raise money for the Exchequer and we should all remember this.
Mansion Tax is a pseudonym for Home Tax and anyone that may at first feel that this just effects wealthy people are delusional. It will deleteriously affect the very wealth creators that we want to encourage to invest in the UK, employ people and build the economy yet it is doing the opposite. Whilst the unaffected populace may be applauding this ‘rich bashing’ exercise this will come to ‘bite them where it hurts’ when jobs are put at risk by the negative effects of this causing a stagnant market where the construction industry needs less brick layers, plumber and electricians. Retailers will suffer with a diminution in sales of both white and brown goods and before you know it the fledgling growth will be extinguished and who will be laughing then?
The problem with monies raised through Council Tax is that it goes to the Councils and not to the Exchequer and, frankly, raising more money for some Councils to squander is a fruitless exercise.
Mr Alexander claims that he will cream off this new largesse but lets see him implement a system to do so.
The valuations at each change of Tax Band will be vigorously contested by householders in a way not seen previously.
I see this juggernaut hurtling towards the abyss, a view shared by many.