I agree wholeheartedly with all of that. But I think it could be collected as long as there was not, as you anyway say should be avoided, a volatile relationship to current house prices, requiring too frequent reassessment.
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UKIP win Clacton by-election by a landslide
- Thread starter MikeG
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If the figure was set at £2m (a figure mentioned by both Labour and LibDems) then depending on where you get your figures from, there are between 58,500 and 110,000 properties that will be hit with the tax. I believe that the intention is to try and raise £1-2bn which implies a hefty tax per property (and hence a good reason to try and avoid it). Of course at this stage the details have not been worked through but my questions would include:
- If I own multiple properties in the same building, are they treated individually or togther for mansion tax purposes. Could I avoid mansion tax by splitting my property ?
- What if most of the vlaue of the property is in the garden ? A modest house with several acres in the South East may be worth a fortune. Split off the land into a spearate entity (presumably land without buildings will not be subject to the mansion tax) and I may duck back under the mansion tax threshold
- What about agricultural property, will that get an exemption ? A modest farmhouse with a few hundred acres could easily be worth in excess of £2m. What if it's a mansion with a couple of acres of "farm land"
- What about business properties ?
Until (if ever) the details are worked through then I don't have much confidence in it working.
ddt
Mafia Penguin
Ouch. So when a house is sold for £ 251,000, the deed says only £ 250,000 and the other 1,000 quid go under the table?
Dutch transfer tax on houses is just a flat percentage, 2% (was 6% a few years ago, and 5% when it was introduced by the Duke of Alba around 1570).
Why so difficult? If you want progressive taxation, why not use the same scheme as with income tax: higher percentages over each following tax bracket?
10% over the first £ 5,000
20% over the second £ 5,000
30% over the amount between £ 10,000 and £ 20,000
etc.
(the numbers pulled from my ass, but just to show the principle). That's a well-understood scheme, it has no artifical barriers and you can make a nice table which shows the cumulative amount of tax resulting from the bottom X brackets.
angrysoba
Philosophile
Assuming that I have watched what you say is an "excellent demolition job", I must beg to differ.
The problem with these sorts of programmes is they preach to the choir. Nobody who is going to watch this is going to be *shocked* by the "strong language" that Nigel Farage uses to the *get the smelling salts ready* President of the EU Commission!
I think also that doddery old guy bullhorning people in the market about Jews, Pakistanis and Chinese has been edited in a somewhat dishonest way. It seems like he was actually praising the kinds of immigration he was mentioning. I could be wrong, but I would be interested in other people's take.
Then there is some stuff about how Farage himself is probably embezzling money, which he may be for all I know. But some of it seemed to mix together basic campaign strategy of targeting particular seats and didn't seem that sinister to me. In fact, the BBC seemed to be showing UKIP literature which publicised the expenditure although we were not really told where it came from. The narrator simply says, "We've obtained documents which appear to show that..." okay, but from where? We are not told.
Then we meet some guy who tells us that Nigel Farage would stab you in the back; that he's like Brutus. But this is coming from a guy who himself is a UKIP former member who wanted the party to be "more professional". Okay, and tell us more... no, that's the end of the anecdote.
Then there's some other stuff showing that Nigel Farage can be quite rude to people in the EU which includes doing things like turning his back on the European Anthem ("Oh no!").
Seriously, this really was a crappy and counter-productive crappy piece of crappy crap.
You might suspect that this happens or that you make an arrangement for the additional £1,000 to pay for fixtures and fittings but that may affect your mortgage if you're cutting it very fine on your Loan To Value (% of the house's value you're borrowing) calculation.
In practice it means that houses either market for and sell at just under £250k or for significantly more. There are other thresholds at £125k, £500k, £1m and £2m with similar price distortions around these price points.
I would set the limit lower. I noted the issues you raise. All taxes have complexities of the kinds you describe. There's nothing insuperable there.
Not if the tax is implemented as ddt describes with the higher rate only applying over the threshold....
I wouldn't have a problem with stamp duty if if was applied:
- at 0% on the first £125k
- at 2% on the next £125k
- at 4% on the next £250k and so on....
In this way someone selling a house for £250k would pay £2,500 in stamp duty (as now), someone selling a house for £250,001 would pay £2,500.04. (and not £7,500.03 as now)
Again, that sort of thing happens in many taxes, where there are different threshold or percentage bands.
Come on Craig. I am not saying there is anything special, or anything wrong with thresholds.......just that isn't any necessity for their existence. This in response to The Don who gave a good example of the silliness that ensues around the thresholds. You might do well to go a couple of dozen posts up the page and do a little reading.
You said that there will be iniquitous results. That sounds wrong to me. I'm now going to go back and do the reading you recommend. I'll see what I find.
Done that. I've found
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The issue was in the way that the stamp duty implemented, that instead of extra tax being due on incremental asset values above the threshold it was due on the entire asset value at the higher rate. The issue is not with thresholds.
It's the only tax I've encountered in the UK that works that way but I am informed by colleagues that income tax in Germany is like that.
Christ Craig, it really is hardly worth having a sensible conversation with you sometimes. Gormless quote-mining designed just to infuriate, yet again. I'll respond this time, to help you, but your needling is getting to the point where I just won't bother any more.
Here is the post you should have gone and found. It is this that I was responding to:
Why didn't you say so then, instead of telling me vaguely to "do a little reading" back "a couple of dozen posts"?
ddt
Mafia Penguin
No, as The Don alrady explained:
And you have a nice, continuous graph if you'd plot it: it would essentially be a chain of line segments that progressively have a bigger angle to the X-axis.
That claim made me curious, so I whipped out my German tax guide from 1993 (when I lived there). It only has a table in it, and I understand when lookin at the actual law. This being Germany, it is a difficult formula which makes the tax rate smoothly progressive. I'll translate:
Income 0-8,354: Tax is 0
Income 8,355-13,469: Tax is (974,58 * y + 1 400) * y, where y = (Income - 8,354)/10,000
Income 13,470-52,881: Tax is (228,74 * z + 2 397) * z + 971,
where z = (Income - 13,469)/10,000
etc.
Note that there's a quadratic in each bracket. And if you calculate the tax for 13,469 and for 13,470, you'll see it's both 971.
Because I wanted you to read the whole exchange, which you clearly hadn't done before posting #150. Posts #132 to #150 cover it, so asking you to read (roughly) a couple of dozen posts was what I meant.
I see.
Yes, I now understand.He is right, although there are still a number of drawbacks with having thresholds. I'll describe one of them below.
Only if there is an endless array of thresholds, evenly arranged* and covering all of the range of incomes/ property values/ capital values (for CGT) and so on. In practice, this is never done. As with Property Band G in Council Tax calculations there is always an upper threshold which is below the highest figure by a very considerable way.
*Evenly is the wrong word. I mean arranged in such a way as the curving line on the graph you described remains smooth. This could well mean that the gaps are logarithmic, for all I know. They aren't normally so well thought out, being as they are subject to political whim.
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