Housing and Taxation: The self over all others

Whilst taxes levied on UK residential property are never out of season for the “water cooler conversation”, the discussion is manifestly dialled-up ahead of General Elections. Indeed, such is the visceral and selfish nature of our opinions on “housing as an asset”, detailed promises of to how to change tax on our bricks and mortar, never appear concretely in Manifestos.

The reality is that parties claiming to be redistributive, fear that those pledging fealty to them, could, in the privacy of the ballet booth, discretely disavow and cast their vote elsewhere. A highly likely outcome, if voters thought the changes pledged to how private property was taxed, went against their “familial financial interests”.

With the above in mind let’s please consider swirling rumours that an incoming Labour Government would remove the CGT exemption on the sale of main residences, as well as quickly revaluing the long-standing (1991) taxonomy of council tax bands.

I have no doubt efforts will be made to publicly distance the PLP from the idea that such development would be immediate policy once elected. This is not to say Labour would not do so, merely it will not make THE ERROR ex ante of Metropolitan Middle Class Tax Hikes, being election promises/threats.

Whilst I am speculating on its influence over voting, I believe that the real/imagined expectation of it introducing a Mansion Tax, were it to have won the General Election, played greatly against Labour in 2015; and also contributed significantly to the Lib Dem’s exceptionally poor showing.

The reality is that for all that divides the UK electorate across party lines, there is one very common view; those ON THE UK main residential property ladder, believe it to be Tax-Free and Do-Not-Disturb. Indeed, the fact that the Conservatives have promised, were they to win, the scrapping of Stamp Duty for first time buyers (FTBs), plays into this.

So much then for the politics of UK property taxation, let’s move to its economics.