Monday, 2 September 2013

How Camden fares with the Mansion Tax

Top-end estate agents Knight Frank have produced some research showing the impact of a Mansion Tax on areas of the country

The Mansion Tax is a policy proposed by the Liberal Democrats and Labour to capture some of the gains made in the property market at higher values.

Knight Frank's conclusion is that the mansion tax, as currently proposed, will raise "approximately £1.3bn annually, before exemptions", which is less than wonks in Lib Dem and Labour research departments had calculated.

The research shows that Camden would be one of the highest contributors in the country - with over 3900 properties subject to the new levy, if introduced. 

This is a useful number, as it indicates that an area like ours would stand to gain substantially if the tax were introduced.  (A little bit sillier are the figures if the £2m were not indexed).

Knight Frank add: "The tax would be levied overwhelmingly on London and the South East of England, with 86.4% of all £2m+ properties located in those two regions."

Therein lies the rub.  

From a Camden perspective, the problem with the Mansion Tax  is how it would be collected and distributed. Without a real connection with local services (e.g. like Council Tax), money raised would be seen as going straight to the Treasury - before being distributed across the country like other taxes.

If money could reside where it is collected - or even be ring-fenced for new homes - then that would make much more sense.

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