The British Property Federation (BPF) has released the results of a poll commissioned from ComRes which reveals that the majority (69%) of MPs believe that additional higher-rate council tax bands would be a better way to reform annual property taxes on high-value homes than introducing a mansion tax.
The poll shows that two-fifths (39%) of Labour Party’s MPs favour additional higher-rate council tax bands over a mansion tax, despite the party championing the tax as one of its flagship policies ahead of the General Election. Just over half (56%) thought a mansion tax would be preferable.
The majority (89%) of the Liberal Democrat MPs surveyed also prefer additional council tax bands to a mansion tax, as do 92% of Conservative MPs. The Liberal Democrats first mooted the idea of the policy in 2012.
Three quarters of respondents would also support a revaluation of all homes to update council tax with stronger support among Labour MPs (87%) than Conservative MPs (64%). It seems that this is a priority issue for MPs, with the majority (53%) of those who would like to see reform preferring revaluation during the next Parliament.
A council tax revaluation would be very easy to implement in the next Parliament because there is already legislative provision for it in the Local Government Act 2003. It would also accord with the advice of the Lyons Inquiry to Labour in 2007 which suggested that a future Government should revalue council tax and add new council tax bands in order to update the tax base and improve fairness for taxpayers.
Commenting on the findings of the BPF poll, Martin Codd, head of the Penningtons Manches property entrepreneur group, said: “I am not surprised by these poll results. It's ridiculous that, under the current system, someone who lives in a multimillion pound home pays only three times more than someone living in a small bedsit which falls into Band A. Other parts of the UK, notably Wales in 2005, have adjusted the banding and even brought in a higher band I.
“The proposed mansion tax by the Labour Party is proving to be deeply unpopular and looks likely to be expensive to bring in. There is already an established system dealing with local taxes and it just needs to be revised by re-banding and re-valuing. As both Wales and Scotland have done this, then why not England and the rest of the UK?”
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