Proposals for a Mansion Tax are ‘outdated and unnecessary’ as high value properties are already being targeted by new taxation hikes, a report is claiming.
The Shrinking Case for a Mansion Tax, published by the Centre for Policy Studies, argues that in the five years since the policy was proposed, there have been over ‘significant’ tax hikes implemented affected high value properties. This includes Stamp Duty Land reforms - half of which is paid by the top 1.6% households - and the increased Annual Tax on Enveloped Dwellings.
Lucian Cook, author of the report and director of research at Savills, said reforms meant to close loopholes that existed when Mansion Tax was first proposed have seen the tax paid on mansions increase by 40% in some cases.
‘The recent reforms of property taxation are raising as much from high value properties as any Mansion Tax,’ Cook said. ‘If in addition to these reforms, a Mansion Tax were introduced after the next election, it would add a layer of complexity and unfairness into the tax system for residential property.
‘On top of that, the economic impact of a Mansion Tax is impossible to quantify but would clearly be damaging, not least in seriously undermining the attraction of the UK (and London in particular) to overseas investors.’
