The Liberal Party proposed taxation plans on Millionaire home owners may not be straightforward to implement according to the Royal Institute of Chartered Surveyors RICS
Commenting on the Liberal Democrats announcement that they plan to levy a tax on all properties over £1 million, Chris Doyle, the Chairman of the RICS Taxation Panel says:
“Although taxes on properties over £1 million may be an effective way to raise additional funds, RICS sees a number of practical problems in implementing the proposals and potential consequences which will need to be carefully thought through. These include the need to ensure that valuations are fair and accurate, given that the last valuations were done 18 years ago; the cost of administration given the likely number of appeals; the ability to pay, since the proposed tax is based on the value of the property and not the owners income; and the potential market distortion such a tax would create. A lack of information also means it is not straightforward to even estimate the potential revenues from, and benefits of, the scheme.”
A homeowner with a luxury property that is worth more than 1 million will pay the additional tax on whatever the value over the first 1 million. Properties worth £1 over £1 million will pay 0.5 percent of £1, or half a pence and so on.
The Liberal Democrats have proposed a new tax on properties worth more than £1 million. It is estimated that this tax will raise an additional £1.25 billion a year. Liberal Democrat leader Nick Clegg proposed the tax and recently spoke about it on BBC’s Radio 4 Today program, noting that “It’s a fairer tax that Labour should have done 10 years ago in the interest of a fair society.”
“It affects 1 percent of property owners in this country and it is for a purpose,” he said. “The purpose is fairness.”
Clegg said that assessing the tax would be easy using land registry documents to determine property values. The new tax would be assessed on some 250,000 properties, according to the party.
