CABLE’S PLANS?FOR 1M HOME TAX SLAMMED
PROPERTY experts yesterday ridiculed Liberal Democrat Treasury spokesman Vince Cable’s pledge to introduce an annual levy on homes worth more than £1m, warning that the measure would lay waste to an already fragile housing market.
The so-called “mansion tax”, proposed by Cable at the Lib Dem annual party conference yesterday, would see some 250,000 households pay 0.5 per cent on the value of their property above £1m, equating to £2,500 on a house worth £1.5m.
But key figures from the property sector rounded on Cable yesterday, claiming that his plans would wreak havoc on the housing market.
Head of residential research at Knight Frank Liam Bailey said the tax would destroy the market for homes just below the £1m mark and unfairly punish the South East.
“Coming on the back of the non-dom levy, and the 50 per cent tax rate the sign would be very clear – that the UK is not a location for highly paid or highly motivated people to come to,” he added.
Ed Mead, director of Douglas and Gordon said: “This will freeze up the housing market at a time when that is the last thing it needs. It’s absolutely outrageous.”
DTZ director Mike Bickerton added that the tax would hit pensioners whose homes have increased in value and was “not a vote winner for the Lib Dems”.
Cable said the levy would raise £1.1bn towards funding a change in the income tax threshold from £6,475 to £10,000, lifting four million people out of taxation on earnings altogether.
In total, Cable believes he can raise £17bn by targeting the wealthiest members of society and closing tax loopholes.
On spending, Cable savaged the Tories, who he said were committed to £53bn in extra spending and “so arrogant they think they can walk into Downing Street without anyone noticing”.
He identified a host of other programmes that could be cut to reduce pressure on the public purse, including the Crossrail project, whichCable said wasn’t a “key priority”.
Kulveer Ranger, the Mayor of London’s advisor on transport policy, said: “Vince Cable must be the only person in London who believes a project that will add at least £20bn to the economy, and will employ some 14,000 people is not a priority.”
Cable also said a Liberal Democrat government would scrap the NHS database and ID cards, as he sought to make his party appear tougher on spending.