by Atul Hatwal
Myleene Klass is a lucky woman. She went on ITV’s Agenda last night, talked nonsense about taxation and should have been ridiculed.
Comparing taxing a glass of water to higher tax rates for properties worth over £2m is idiotic. But because Myleene was up against a hesitant and tentative Ed Miliband, she has emerged this morning in the press as an anti-tax Boudicca.
In his exchange with Myleene, Ed Miliband failed on two counts: first, to challenge the notion that taxing more expensive properties at a higher rate was somehow arbitrary and second, to highlight the crushing inequity of the current council tax system.
Taxing property is not some on-the-hoof fancy dreamt up by the Labour party. From the Window tax of 1707 onwards, it’s been central to how government raises money as long as the United Kingdom has existed.
The methods might not have been perfect, but as a principle, the progressive taxation of property is anything but arbitrary.
And the reason a mansion tax is being discussed is that the current system of council tax is grotesquely unfair: people with the lowest value properties pay proportionately much, much more than those with more expensive homes.
In Kensington and Chelsea, someone at the upper rate of the lowest council tax band, with a property value of £40,000 pays 17 times more than a householder with a £2m property, as a proportion of their property value.
Even at the start of the highest council tax band, with properties at £320,000, the owner will proportionately pay five times more than someone with a £2m property.
The scale of inequality rises as the value of properties increase.
There are estimated to be 3,850 properties worth £10m or more, a large proportion in Kensington and Chelsea. A home owner at the bottom of the housing food chain in this Borough, with a property worth £40,000 will pay 83 times more in council tax, as a percentage of their property value, than the owner of a £10m home.
This is a ridiculous state of affairs. Change needs to be implemented carefully but few can rationally argue for the status quo where the poorest pay almost 100 times more in tax than the richest.
Yet Ed Miliband did not make this argument. Instead he talked in generalities about tough decisions and the need to fund the NHS.
By failing to make the case for how a mansion tax would reduce the current imbalance in the council tax system, he could not move on to talk about the NHS and lost the argument.
It was a microcosm of Labour’s wider problem when talking about the economy.
Few are listening to Labour’s plans on housing, the NHS or jobs because the party hasn’t engaged in the argument on spending, mapping out what will be cut and what will be funded.
The party has neither made the case for unalloyed greater spending as the left want, nor how it can be trusted to control spending as party centrists’ desire.
As a result, the brighter future that a Labour government could bring remains resolutely ignored.
Ed Miliband is meant to be fighting back, redefining himself and Labour’s offer to voters. Unfortunately, last night, it was a case of plus ça change.
Atul Hatwal is editor of Uncut
Tags: Atul Hatwal, Ed Miliband, Kensington and Chelsea, mansion tax, Myleene Klass, Window tax
Does it not bother you that the leader of the Labour Party — a chap we’re told is terribly clever — lost a battle of wits to a pop star/TV host?
Problem is that there is a lot wrong with the mansion tax and reinforces the idea that we are anti-homeownership and anti-aspirational. Best solution would be to have additional council tax bands and a revaluation of the council tax system and even aligning CGT with income tax.
Ed was completely out of his comfort zone on Agenda, and allowed Myleene to get away with murder. He did come back with the Bedroom Tax and the usual stuff on cost of living etc and the hard working poor etc. We keep being told that Ed is a good decent honest bloke who cares in real life etc when in a relaxed situation etc, but I’m finding it hard to believe. Agenda, and on the Sofa, are perfect opportunities to convince people that he’s just ‘one of us’, only he isn’t, he’s a millionaire himself and has been promoted beyond his capabilities. And I don’t think he’s convinced anyone , not even in Doncaster. We have a Shadow Cabinet filled with the Primrose Hill Mob and the Hampstead Set and and the Notting Hill Brigade and the Stoke Newington- Haringay-Islington Clique. And none of them has had a real job in their life.
The problem with you arguement and logic is simple. The cost of services provided does not correlate to the value of the house. It costs the same for the local authority to collect the bins whether your house is valued at £40K or £4 M. The authority has a minimum cost to cover, so even on lower value properties there will be a “cost price”.
If you are saying that the cost price for a lower value home owner should be ignored and that the higher value properties tax should be increased to cover the cost, where do you start and stop ? What value is the lower limit ? What if say a millionaire ownes a flat at £200K value, what do they pay ? If a property has been passed down through the family and is now worth £2M but is occupied by an older person with no large income, what do they pay ?
This isn’t about fairness or equality its about Red Ed’s marxist instincts and penalising the rich. The politics of envy and penalises the success of London.
But bear this in mind before you red’s make this move. Tax revenues from London are spread throughout the UK and London provides a disproportionate amount of tax for the benefit of the whole of the UK. If revenues drop due to this stupidity, we are all in the shit.
Miliband hasn’t got a clue. The man is a colossal buffoon and as Renie has stated he is anti-aspirational and aims for the lowest common denominator. This may be OK in “Ed’s world” but not in the public’s mind.
He got whitewashed because he doesn’t think quickly enough, doesn’t react quickly enough and isn’t aggresive enough. I can’t wait for the leader debates – if he doesn’t sharpen up quickly he will be little more than a comedy sideshow.
As for the mansion tax – how many would be Labour swing voters live in one million pound houses? My there must be a fozen or more. They are inconsequential. Nearly all vote tory, ;ive in tory areas, and those that don’t are either foreign or UKOP or don’t vote. Tax the f***ers and have done with it.
Things can only get better when Ed is PM..
Err….:-)
He’s got till the by election result tommorow, to realise ,he’s got to resign ,or he’ll have to carry then can for the massacre in 5 and a half months time
Adding a new layer of taxation will solve nothing. Simply reform the existing tax system and redress the inequality of the council tax band system by making it more proportional to the property’s value.
Hmm the Mansion tax. Sounds like a bash the rich tax. Which plays well in theory in these times. But it does sound like it’s a London tax in particular as that is where all the expensive property is. Considering all the anti London mithering in the North, again that might not seem a problem.
Except the one area that the current metropolitan Labour politics seems to be playing well is in London and they do not like this one bit. all those upper middle class professionals who support labour in North London and bought their house for less than half a million 20 years ago, now have houses at or nearing 2 milllion now.
Also no one believes that this new tax will stay on properties worth 2 million do they? It won’t raise that much money and the new government will be desperate for extra taxes, how long before that threshold slips to 1 million or even lower.
Might not mean that much to people outside Southern England, but could prove toxic to all London Labour MP’s. I mean if you lose all your Scottish MP’s is it wise to Lose London as well.
Let’s face it Miliband is bloody hopeless. And I had to Google Myleene Klass before I even knew who she was!
Ed was rather slow in his responses to Klass, but it gave her enough rope to hang herself. Reaction on social media is very much that Klass was selfish, out-of-touch and wrong. Best endorsement for the Mansion Tax there could have been.
I cannot believe how poor his responses were. He’s coming across more and more as a backroom boy, not a leader. For the sake of the party, and the country in 2015, let’s hope he does the decent thing soon.
Ladies Defending Labour were driven to blog on this hapless story. We asked the question: Bedroom Tax or Mansion Tax? Check it out here:
http://ladiesdefendinglabour.wordpress.com/2014/11/18/bedroom-tax-or-mansion-tax-should-we-defend-robbing-little-grannies-with-a-spare-room-or-charging-the-super-rich-who-have-many-many-rooms-to-spare/
I glimpse a chilling view of the privilege of celebrities, they think it is ok to spend their time for free to get us to to donate to causes that they frame and promote as tragedy. When it comes to time for them to pay some of their wealth to help to prevent the tragedy from happening in the first place they get snappy. It is a tragedy that people are having their health and long term wellbeing damaged by a health service that is being bled to death. Do we get people who have the money to pay a little more or do we wait until they get free airtime and shed a few tears at the next publicity sorry charity fundraiser and send them more of our money to gift out.
@ David White
And what planet do you live on again…?
@ Tina — No sorry, the mansion tax is a bad, bad idea.* A property speculator with 100 houses worth 1 million wouldn’t pay a penny whilst a relatively well to do couple who bought a house in an area that’s now become desirable would get hammered.
Plus, it’d be the easiest dodge in the world. Splitting a house into two ‘flats’ springs to mind.
Why not just add some extra bands to the existing tax?
*The bedroom tax is a bad idea as well, but bringing it into this conversation smacks of whataboutery.
I thought she was pretty good for someone not coached in debating politics and her points were mainly valid. Why are people, rich or poor, getting taxed more and more rather than politicians reviewing how the state wastes money? Is something as arbitrary and constantly fluctuating as property value really the fairest thing to tax people on, when people in London and the South East would be effectively punished for where they live rather than how big their home is? The house I grew up in, a very ordinary suburban semi (my parents are not rich), is now worth nearly three quarters of a million. It was also brought up, how would the government even stay on top of which properties were worth more than £2 million, for which Ed had no answer.
Here’s my problem, which I don’t think was even raised. My one bedroom flat in South London has recently been valued at over £250,000, the 3% stamp duty threshold. When that threshold was put in, it was not designed to hit people with modest properties in the suburbs and it would have been defended, like Ed’s mansion tax, as making the rich pay more. Same with the 40% higher tax threshold, which has also been left as it is while inflation has risen, and now hits people on pretty modest pay grades. I don’t trust Labour or the Tories not to impose this and then say a year later, people with £1 million pound houses should pay this too, or to just let the threshold as it is and watch as house prices creep up and into the bracket.
My one bedroom flat in South London has recently been valued at over £250,000 Round here you can be a detached 4/5 bed house with garage for that, sea views, panoramic views of snowdonia.
hits people on pretty modest pay grades. Around most of the country, if you can afford a 250K house one thing you are not on is a ‘modest pay grade’ – you are in a good job with a good salary.
“The problem with you arguement and logic is simple. The cost of services provided does not correlate to the value of the house. It costs the same for the local authority to collect the bins whether your house is valued at £40K or £4 M. The authority has a minimum cost to cover, so even on lower value properties there will be a “cost price”.”
Your argument is flawed. Taxes should be progressive where the rich pay more than the poor, eg income tax. The cost to provide health care is the same whether rich or poor yet the rich currently pay more to the NHS through income tax. Mansion taxes aren’t designed to pay for local council services so comparing them to council tax is meaningless. Regressive taxes like council tax are what we need to move away from to create a fair society.
And we thus see, neatly summarised above in numerous posters’ own words, the fundamental view of the softish left: “the purpose of money is to provide the government with funds, through taxation, to disburse to those whose allegiance it wishes to purchase”.
How about:
”
Tax is a simple service charge, payable to the government, which is an institution which the nation, collectively, maintains in order to deliver essential services – those which no other provider can deliver – in order to allow the nation, collectively, to get the fuck on with its life”.
@ Chris
I suggest you read Atuls post again. Part of his arguement or statement was about the proportinality of the council tax in relation to the value of the property. My point was that the cost of services does not correlate with the value.
Your point is about taxing the rich and you assume of course that large houses are owned by the “rich” when in fact it may have been passed down a family chain where they are asset rich and cash poor. Of course in your quest for a “fair society” it involves taking other people’s money for your pet project. The “rich” in our country pay 28% of our income tax take, is that not enough for you ?
Tax the hell out of expensive 1m+ properties and those owning multiple properties.
1 it will claw back some of the money stolen from our children by the super rich during the great bank bail out con
2 its a lot harder for them to tax avoid than income taxes
3 it gets those who benefited from the crash to pay
4 it will reduce property prices as they sell up, making it easier for the aspirational young to get on the housing ladder
5 it will help drive out slum landlords
6 it will redistribute income from the wealthy to the upper working / lower middle classes, the people who actually do the work and drive the economy
7 it will see a reduction in ghost villages full of holiday homes and vast swathes of west London sitting empty due to being used as asset banks by foreign billionaires.
ENVY for want of a better word is good, ENVY works.
8 also it will encourage the rich to look at other ways to make wealth, like starting businesses and employing people rather than sitting on housing stock driving up prices and taking from those in the middle to give to those at the top