Statistics have shown that only a very small number of poor British households live in very expensive properties, removing one of the obstacles to a mansion tax. The ONS reported that only 1% of households with incomes in the bottom 40% had property wealth over £500,000.
With Labour and the Liberal Democrats proposing to introduce a mansion tax for properties worth more than £2m after the next election, the figures suggest that few people who live in expensive homes lack the income to pay the tax.
The ONS survey found that only 2% of middle-income earners had property assets worth more than £500,000. The top 20% of households, measured by income, held 44% of total wealth, while 50% of households with top incomes were also in the top 20% of the wealth distribution.
Source: Financial Times
We say: The principle argument against a Mansion Tax isn’t that it would be imposed on people who are asset-rich but cash-poor: it’s that it’s a poorly-targeted Selective Wealth Tax. It makes no sense, for example, to charge the tax on a man who owns one expensive home but not on a man who has half a dozen homes of lower individual value: or to charge it on the value of a man’s house but not his collection of valuable antiques, paintings, classic cars or whatever. The only merit of a Mansion Tax is that it’s a simple and cheap way to collect money. But so is mugging.
