It’s Still Us and Them

St Pauls

The Labour Party have recently announced a plan to charge a ‘Mansion Tax’ on people who own property worth more than £2m.  The LibDems too, are keen to extract more cash from those who are deemed to have cash because they have a house worth a lot of money, whether or not they have disposable income to pay it.

But as usual, there is one group of people who will be protected from this new surcharge – our MPs.

This article from the Daily Mirror suggests that MPs will be able to charge any such tax on expenses, proving again that we’re not all in it together.

The whole problem of implementing a Mansion Tax is discussed in this article from the DT that tells the story of farmers in France being crippled by the equivalent measure.

There was a story recently that 30% of all tax revenue now comes from just 300,000 tax payers.

I don’t own a £2m home – far from it – so I’m not going to be impacted by any proposed mansion tax, but there is surely a limit to how much anyone is prepared to pay in tax – even the super rich.



3 responses to “It’s Still Us and Them

  1. “There was a story recently that 30% of all tax revenue now comes from just 300,000 tax payers.”

    The top 1% of income tax payers(290,000)) pay, 27% of Income Tax. But as this is our only progressive tax of any note, the rest being flat/regressive, they only pay 12.7% of total taxation.

    They receive 11.9% of total income.

    Who creates and sustains the value of the location that freeholders property occupies?

    Because the incidence of the Mansion Tax only falls on land, it only recoups back to the community a tiny fraction of the value it creates together,

    Which is why, unlike taxes on income/capital the Mansion Tax is morally correct and therefore economically efficient.


  2. Thanks for your comments.

    Part of the problem I have is that the value of one’s house is no measure of one’s ability to pay tax.

    If you want to focus on who can afford to pay tax then – as a rule – you can choose to tax those who earn the most or those who spend the most or limit the ability of everyone (people and business) to avoid paying tax.

    I remain to be convinced that targeting valuable property is the best/ fairest way to decide who should fund the country.


  3. Yes, a “tax” should be based on the ability to pay. A tax being a coercive charge against value produced and sustained by the payer i.e income and capital.

    But the incidence of the Mansion Tax isn’t on income or capital. It is on location, the value of which is neither produced or sustained by the efforts freeholder. Furthermore, unlike taxes on income/capital the payer of the Mansion Tax choses whether they want to pay it or not. It is 100% avoidable,

    As such, the Mansion Tax is not technically a “tax”, it is a user fee, or a consumption charge. Completely different immorally and therefore economically from a “tax”. So, like paying for any other good or service, income level/ability to pay is utterly irrelevant.

    This is why immoral taxes on income/capital shrink economic output and makes us all poorer the Mansion Tax doesn’t.


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s