Mansion Tax the Human dilemma

Wednesday, September 24, 2014 by Ed Mead

The conference season and the need to be seen to bash the “rich” mean Mansion Tax is rearing its head…..again, just as it seemed all political parties were settling on a sensible, and efficacious, updating of Council Tax. Mansion Tax is so much more divisive a word with really ugly connotations.

 

Objections have focused on the unfairness of the tax and the rank inability to pay of many who have either inherited a house or mortgaged themselves to the hilt to give themselves and their family the best possible home. The number one reason for the slowdown at the top end of the market is given as concerns over a mansion tax and research has clearly shown that those who buy in the price ranges affected have a disproportionately good effect on their local economy spending by far the largest amount of any socio economic group.

 

My interest though has always been piqued by how it would be implemented and how valuations would take place. Given that many of those living in houses over £2m are opinionated I would guess that many valuations, given their significance, would end up in Court.

 

Interestingly though if owners had to self-certify that would be a real dilemma for many. Property owners always tend to have an understandably inflated opinion of its value. So, given many like to tell everyone what their house is worth are they going to have to put a different figure on their tax return or stop sounding off about its value. How would they calculate the value and would that figure be shown when the house goes on the market. Is an agents opinion enough and since when did agents low ball the value anyway.

 

Self-certification applies now with ATED company buyers but of course these are people looking to shelter for different reasons, supposedly rich foreigners preferring anonymity and happy to pay for it, not the same thing.