LABOUR IGNORING FAIREST WAY TO RAISE REVENUE FOR NHS BY BACKING THEIR PUNITIVE MANSION TAX, NEW REPORT REVEALS
- FairHomeTax UK report by the CEBR recommends a fairer and more progressive approach to property taxation
- Works by improving existing mechanisms, like council tax, to raise billions for NHS and local services while directly benefitting nurses and public sector workers
- Demonstrates Labour’s Mansion Tax is flawed and an ideologically driven piece of electioneering that won’t raise the £1.2 billion Miliband promises to
- Shows that politicians from all parties are ignoring the elephant in the room – council tax – which hasn’t been reviewed to reflect changing property prices in over 20 years
- Sets out path to a more equitable home taxation system, doing more to improve the NHS and local services, faster.
FairHomeTax UK, an independent campaigning group concerned with fairer property taxation in Britain, has commissioned the highly respected economics organisation, the Centre for Business Research (CEBR), to investigate Labour’s Mansion Tax proposals ahead of the 2015 general election. The research, published in two parts, reaches its conclusions today and the findings will come as a blow to Ed
Miliband and Labour’s much-vaunted Mansion Tax proposals. Although a populist policy, Labour’s proposed Mansion Tax is punitive and limited in its scope. It is difficult and costly to enforce, introduces more red tape and bureaucracy and is ideologically driven rather than focussed on improving public services. The first part of the CEBR report, published in December 2014, found that:
- Labour’s Plans will kill house sales
- Stamp Duty will fall by £2bn
- Elderly homeowners will be hardest hit
- Mansion Tax won’t raise the promised £1.2bn for NHS
- Homeowners will be able to easily avoid paying Mansion Tax
- Mansion Tax is unworkable and unsustainable
In the latest addition to the report, published today, the CEBR and FairHomeTax sets out an alternative and more
equitable approach to property taxation by reviewing the Council Tax system. Its findings revel that:
- The addition of three Council Tax bands above H could contribute £4.7 billion additional revenue to tax receipts in 2015-16.
- This more than trebles the amount Labour claims Mansion Tax will raise for the NHS
- A total income from this revised common sense approach to the Treasury and local authorities would be £25.6 billion by 2019-20
- AND It will only cost £257 million to implement
Like the Mansion Tax, this reformed system would shift part of the tax burden to occupants of very high value properties and those that have benefited from above average house price growth. BUT, given that the average cost of moving up one band is £350 annually, the reform is unlikely to create substantial market distortions.Under the existing system of council taxation, a resident of a property in Band A, B, and C pays on average £998, £1,165, and £1,331 respectively in annual council tax. Under the reformed system residents of Band A properties would pay no council tax, while those in Bands B and C would pay significantly reduced amounts.
As well as injecting significant funds into the NHS, this implementation of a fairer and long overdue council tax review will benefit the very people Labour claims to support - nurses, teachers and other public sector workers. The CEBR reports reveals that in key regions of the UK, Bands A, B and C houses are disproportionately occupied by public sector workers who will directly benefit from the proposes revision. A fairer system of council taxation would also help health workers indirectly by eliminating or reducing the council tax burden in the bottom three bands.Those who can pay a little more will benefit from better local services, instead of their punitive immoral unworkable Mansion Tax idea.
Howard Cox, well known Public Affairs Campaigner and Founder of FairHomeTax.uk said: "For too long politicians from all parties have ignored the proverbial elephant in the room: Council Tax. Despite massive changes in the value of British houses, it’s a quarter of a century since the council tax system was looked at. Our FairHomeTax.uk report demonstrates that a revised system - with those living in the most valuable houses paying more - would yield billions for local services and the NHS, while reducing the council tax burden for those living in the least expensive properties. This fairer, more progressive approach to property taxation compared with the proposed Mansion Tax would provide a shot in the arm to local services and the NHS through existing channels, rather than adding more red tape. FairHomeTax's report reveals that Labour's proposed Mansion Tax on the top 0.2% of houses, which could cost tens of millions to administer and would be difficult to enforce, is a far less effective revenue raiser compared with a sensible reassessment of the council tax bands. It exposes Labour’s ideologically driven and punitive mansion tax as a shameless piece of electioneering whose principle could be applied more practically, for less money in a way that directly helps the majority of working people. Parliament should debate the proposals by FairHomeTax and the findings of the CEBR as a matter of urgency before the General Election.”