Former Labour leader Neil Kinnock has dismissed fears that the so-called mansion tax would hurt the pockets of middle class Londoners, saying it was little more than they spend on lunch.
The controversial policy being put forward by the shadow government would see a levy imposed on homes worth more than £2m.
The average payment is expected to reach £1,000 a month, though shadow chancellor Ed Balls has promised a reduced fee of £250 a month for houses worth between £2m and £3m.
“For the people who are asset-rich and very prosperous, a couple of hundred quid a month isn’t going to make a difference,” Lord Kinnock said in an interview with the Financial Times. “They would spend that on lunch.”
“I don’t know if people over £150,000 a year have recognised what a small marginal addition that means for them,” he added.
Kinnock – who supported Ed Miliband during his leadership campaign in 2010 – insisted Labour would support the business community, noting that “nobody is talking about raising corporate taxation”.
“Nobody is talking about anything other than the encouragement and reward for medium and long-term investment,” he said.
Estimates suggest the tax could apply to nearly 100,000 properties, many of which are in the capital.
It has been hugely controversial, with a range of commentators piling in to criticise the measure, including former Cabinet minister Lord Mandelson.
Understandably it is also unpopular within the property sector, having already caused some jitters within the market.
Savills has estimated that for Labour to hit its target of £1.2bn raised from the tax, the average levy must reach £12,370.