‘Proudly owning a £500k house doesn't make you wealthy’: Readers problem Reeves’ property tax plan

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Your help makes all of the distinction. Learn extra Impartial readers are divided over proposals being thought of by Chancellor Rachel Reeves for a brand new tax on properties value greater than £500,000, with many questioning whether or not the brink would unfairly have an effect on strange householders slightly than the really rich.

A number of argued that in high-priced areas, £500,000 is just not a marker of wealth, with smaller properties usually costing greater than that.

“In London and elements of the South East, proudly owning a £500k house… doesn't make you wealthy,” famous one reader, whereas others prompt a better threshold or regional variations to keep away from penalising middle-class households.

Some readers welcomed the concept of focusing on unearned property wealth, arguing that a long time of home value rises have created inequalities that youthful generations can't overcome.

“Taxing property, focusing on unearned revenue, is what the federal government must do,” one wrote.

Others warned the tax might have unintended penalties, together with discouraging downsizing, lowering housing market mobility, and forcing householders to lift asking costs to offset the levy.

There have been additionally considerations that pensioners or {couples} on modest incomes might be hit unfairly.

Throughout the board, readers emphasised the necessity for a good strategy that distinguishes real wealth from strange householders.

Right here’s what you needed to say:

Regional home value disparities

I've just lately moved from Berkshire to Yorkshire. The semi-detached home I've purchased was £200,000 in Yorkshire, however the equal and presumably terraced home in Berkshire would have been £500,000. So this tax would definitely be a detriment to staff within the South East. The wage weighting is much from compensating for the home value distinction.

Over a £1,000,000 may be a extra applicable nationwide determine, however presumably there would have to be some regional variations. This may be mirrored in IHT charges for inherited property.

The issue that actually must be addressed is making certain that richer folks really pay tax on all their revenue and/or property, and that they don't seem to be capable of legally "evade" tax utilizing loopholes.

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DavidWR

Do you assume a £500k property tax is truthful? Be part of the dialog within the feedback.

Property wealth tax considerations

A tax on the unearned wealth of property because of the housing market of the final 40 years is a smart tax. Nonetheless, £500,000 is simply too low. It would convey many people who find themselves simply making ends meet into paying a tax they can not afford. In lots of elements of the nation, particularly the South East, £500k will barely get you a two-bed terrace home.

If a pair has scrimped and saved to purchase one in the previous few years and may simply afford the mortgage, they could find yourself being caught in a property they can not afford to promote. That may influence each job mobility and the housing market.

Perhaps increase it to £750k to make sure it is solely the genuinely rich that pay it.

Tabbers

Redistribution of unearned property wealth

Lots of people are lacking the purpose… an excessive amount of of the nation's wealth has been tied up in property, with large will increase in costs over the past 20–30 years, all to be handed on to siblings. Youthful generations with out wealthy mother and father do not stand an opportunity.

The federal government has no selection however to try to extract this unearned revenue and try and redistribute it to provide different folks a future. Taxing property, focusing on unearned revenue, is what the federal government must do (and ignore the naysayers).

ChrisMatthews

Regional variation wanted

£500K is much too low… no manner is that this a wealth tax, extra nearly managing tax. The typical value of a house round right here is about £450K, and that could be a two-bed terrace. Certainly the value shouldn't be a blanket one however replicate completely different areas?

aware

Affect on downsizing

All that's going to do is make it way more doubtless that folks in bigger homes will not downsize, resulting in will increase within the worth of these homes because the market dries up. The price of shifting home is already stopping many pensioners from downsizing. The extent ought to be far greater or adjusted for regional variations on the very least.

KrakenUK

Inefficient housing inventory

Within the south of England, builders solely need to construct massive properties as that’s the place they'll take advantage of revenue. They justify the necessity for big properties by stating there's a horrible shortfall. In actuality, there are tens of millions of enormous properties within the UK with single aged folks rattling about in them, when a smaller, extra environment friendly, high quality house would make way more sense. Older folks balk on the considered promoting up and paying hundreds in Stamp Obligation for his or her new house. A brand new ‘promoting’ tax will simply cement this inglorious cycle.

Hardly Shocked

Council tax outdated

This Council Tax was a last-minute substitute for the Ballot Tax. It has grow to be as unpopular as a result of it's primarily based on property costs almost 35 years in the past. Issues have moved on since then, and so ought to this tax system.

jadfg

Phantasm of wealth via property

The phantasm that you just create wealth whereas sitting in your bottom checking Zoopla to see how a lot your own home has gone up must be damaged. Work creates wealth. Property costs simply redistribute it unfairly. The worst results of home value booms is the emergence of tens of millions of little property empires of buy-to-let buyers who retire at 45 and contribute nothing thereafter. Paradoxically, they find yourself renting to one another's children, however their creativeness doesn’t stretch that far.

Carolan

Center-class southern households

Labour appear decided to lose all help in every single place. In London and elements of the South East, proudly owning a £500k house, which is usually smaller than a £300k house up north, doesn't make you wealthy.

That is partially about making an attempt to win over individuals who name middle-class southerners “the London elite”. Has Starmer not realised that no quantity of crimson meat can fulfill the rabid? They simply develop larger and stronger on it. Starmer and co are reluctant to penalise the super-rich who can get wealthy after their time period in workplace or use their media clout to hound them out.

BrotherChe

Financial warning

Extra adjusting of the web curtains whereas the home crumbles…

Prof Richard Wolff and Analyst Sean Foo on China dumping more and more nugatory US bonds, however after Japan and China, the UK, the third largest holder of nugatory bonds, is shopping for extra – collapse is on the horizon, particularly as Trump blunders with little understanding of the influence:

In the meantime, right here within the UK, our chancellor is shopping for US Treasury Bonds like there’s no tomorrow! On the similar time, we're informed we're so skint we’ll have to chop again on assist for the disabled. This may wreck our financial system – all to try to crawl to Trump, who hates them!

Dolphins

Affect on pensioners

A property tax does not take account of residents' incomes. 4 wage-earners in a £499k property wouldn't pay, however a few pensioners in a £501k property must starve – and freeze – to loss of life.

Lucy Lastic

Property as funding

Individuals look to build up revenue in home possession to compensate for low wages. If their gaff goes up by 5 per cent 12 months on 12 months, they're quids in and may retire in model.

A number of folks personal homes as a enterprise – what share of house owners really reside in that house? Cease anybody proudly owning multiple home, particularly international consumers. We're rife with buyers dispossessing us right here.

covergo

Among the feedback have been edited for this text for brevity and readability.

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