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Lib Dems plot 'super' mansion tax for London
by Michelle McGagh on Sep 13, 2013 at 13:27
The wealthiest homeowners could face a new ‘super mansion tax’ from the Liberal Democrat party, as the junior coalition partner attempts to distance itself from the Conservatives.
Last year the Lib Dems announced they wanted to introduce a 1% tax on properties worth £2 million or more, known as the ‘mansion tax’. The 'super' mansion tax would take things a step further.
According to the Evening Standard, party president Tim Farron has proposed those with property and wealth exceeding £2 million could pay a higher levy than those caught in the original mansion tax net.
Farron’s idea is much more aligned with a ‘wealth tax’, which the Lib Dems party has previously flirted with.
He told the paper: ‘Even when you are talking about people who are relatively wealthy, it’s important that taxation should be progressive.
‘I do take the point that in London there are many homes that are worth a significant amount of money which would be seen as not exorbitantly luxurious properties,’ he said.
‘You could have various rates within the mansion tax. A property worth £4 million, for example paying a higher rate.’
The extension of the mansion tax policy to include higher rates for the most expensive properties comes days after estate agent Knight Frank warned that the current mansion tax plans would fall short of the £1.7 billion the party is trying to raise.
It said the levy would need to be extended to homes worth more than £1.25 million, doubling the number of homes affected from 55,000 to 140,000.
If the threshold is held at £2 million, the number of properties falling under mansion tax will increase from 55,000 to 775,000 over the next 25 years if rates of growth continue as they have done.
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