Chancellor Osborne Rules Out 'Mansion Tax'
George Osborne has ruled out the idea of introducing a "mansion tax" - one of the Liberal Democrats' key demands.
The move is likely to prove highly popular with Conservative MPs - particularly on the party right - but will heighten tensions with their coalition partners.
The Lib Dems reacted with dismay when Prime Minister David Cameron used the veto to oppose the EU fiscal pact last December.
They have continued to lobby Mr Osborne to adopt their plan for an annual levy on homes worth more than £2m, which they first proposed in opposition.
However, Mr Osborne said he was not prepared to accept a tax which "clobbered" people who had worked hard and saved to buy their homes.
He told Sky's Dermot Murnaghan: "We will not have that tax, and nor did I think it is sensible to have a wealth tax in the sense of a tax on your wealth levied annually.
"Other countries have tried that and it has not worked, it has driven enterprise abroad."
Instead, he said the Government would be extending the council tax freeze for a third year in a row, while rises in regulated rail fares would be capped at retail price inflation plus 1%.
Mr Osborne also rebuffed suggestions he and the Conservative Cabinet were 'posh boys' out of touch with the wider public.
The Chancellor said: "That is a characterisation by my political opponents who have created this mess the country is in.
"We had all of those years in the Treasury, Ed Balls and Ed Miliband, where they could have taken these kinds of decisions to, for example, increase stamp duty on the sale of expensive homes."
When asked to explain how he could claim the rich would shoulder the responsibility to reduce the debt when, in his March budget, he reduced the top rate of tax by 5p for anyone earning more than £150,000, Mr Osborne insisted the reduction would create jobs to stimulate the economy.
"The people paying the price (of the cut) were the poor looking for work and not the rich who were not, in fact, paying it. That is why we got rid of it," he said.
"It is hopeless to have a 50p rate which is higher than most of our European competitors. In the same budget, I increased four times as much tax on the rich than the saving from the 50p rate.
"I also increased stamp duty for the richest properties, I restricted tax relief for the wealthy, and I did these things precisely because I am very clear that the wealthiest must bear the greater share of the deficit problem.
"They must bear the greater share but they cannot do it alone. The economy is healing, the deficit is down by a quarter and a million jobs have been created, but it is taking longer than anyone had hoped.
"Our entire economic policy is an enterprise policy. If you do not deal with debts, then the interest rate goes up and it clobbers business, hits families, and it leads to the kind of mess that frankly we inherited from the previous government."
But Mr Cameron has said it is "too early to say" whether the coalition Government would hit its key target for public sector debt to be falling by 2015.
"I'm not an economic forecaster so I cannot tell you exactly what is happening in terms of the day-to-day growth, but I can tell you that our economy is rebalancing," he said.
"Are the Conservatives deserting the common ground of British politics? Absolutely not," he said.
what do you think?
Another Fib Dem's conference aim gone, Why they had a conference is beyond me, proberbly to pretend they can do some thing or achieve a policy to it's final conclusion.
Council tax freeze, great. Another year of council services being cut because there's no money coming in. More libraries closed, council playing fields sold off. Nice token gesture, Gideon.
Oh wonderful!!! So much for the stupid Lib Dems. Regardless on my views on a Mansion Tax, I'm delighted because it shows how pathetic the Lib Dems are. Now....let's watch the Lib Dems re-action and I will tell you now what it will be................absolutely NOTHING. Like the little puppies they are, they will simply roll over onto their backs into submission.
He probably has one...
Col... Or more !
Christmas is coming and he does not want to upset mummy and daddy. Actually I don't believe the way forward is the way forward. Clean up and simplify the current tax rules, give the accounts no room to slither around, by having tax law in plain English and simply stated.
John. It would be nice but don't expect it to happen anytime soon. Successive chancellors have complicated the tax systen every time they dabble with it none more so than Mr Brown
why should someone have their money taken from them & redistributed to benefit lovers, immigrants, public sector noin-jobs? If its not voluntary its theft !!
Well, there is a surprise! But we do not want an "envious" and punative tax system. Some wealthy people work a darn sight harder than the average and do more for all concerned too. But .. some do not. How the latter aquired their massive wealth sits uneasily with most of us - plus we think their obscene wealth is unfair. We need a fairer system of sharing out the wealth that we all help to create. I agree with John Byrne's comment that we need a much more inclusive, fairer and clear cut tax system, not skewed in favour of oliogarchs (or whatever!)
If any boby though any different,their living on a different planet.he does not care what the lib dems want,they are only needed to prop up the government,and have no clout other than to look good to the electorate.
...JOHN BYRE IS A GENIOUS..(below).........SIMPLIFY TAX LAWS.......CUT WELFARE PAYMENTS....GET PEOPLE WORKING,
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Oh dear, do we have to go through why cutting off people's benefits and sending foreigners home will harm the economy again? Seriously, a 10 year old could have grasped the concept by now. They would probably also understand how to use the shift key.
the liberals wont do anything about tories not agreeing to their demands they're too keen on holding onto power with the tories and the tories know it - Clegg will agree to anything his masters wish so long as he's deputy prime minister
Shirley. I suspect so and if he holds the balance of power after 2015 with Labour as the biggest party no prizes for guessing whom he will cosy up to. Chancers the lot of them
OOps ! another fib dems policies blown out of the water
Never mind us that work hard just to survive what an absolute ass-h**e
so the rich don't work hard then eh......
some of the rich just don't work. never have.
We already have a mansion tax. Its called council tax and is a corruption of the old rates system which was property based
if we all paid 30% and no NI then the richer off would not look for ways to avoid tax therefore increasing the tax take. works well in Hong Kong........
I don't hold with property taxes - just because you live in a big house doesn't mean you're loaded. Think of old people who bought modest homes in the London suburbs in the 50s and 60s which could now well be worth over £1m, doean't mean they can pay higher taxes. No - I'm with John Burne and Tom Lee: simplufy the tax system, close the loopholes and bring in a flat rate tax. 30% of £1m is much more than 30% of £50k.
So he is cutting taxes for himself and millionaires but increasing tax for the middle class, and pensioners. In 13 years Labour borrowed 650 billion but in 21/2 years he has borrowed over 1.4 trillion and we give on overseas aid more money than any other country in the world and he allows millionaires to pay no tax and allows civil servants and police officers to have a pension of 75% of their salaries, which we have to pay
the best you can hope for as civil servant is 50% and that's after 40 years continuous employment. The deal used to be that you got a good pension in exchange for a poor salary in comparison with the private sector. That's changed now but 40 years is a life sentance.
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Ha Ha What a joke.Cameron and his men are just riding roughshod over the Libdems at every turn. Cleggy and his boys may as well stay at home
There is an element of rich , who are always ignored. The wealthy land owners, who historically have never been accounted for by the Land Registry. These people have owned inherited land and estates for centuries, yet have never registered there fortunate inheritance, and are not legally required to. This then means there property can never be valued, and hence they pay no inheritance tax or otherwise on there massive property.It is a loophole, usually taken advantage of by our heroic Tories.
Well living in a mansion doesn't usually mean you are skint. If you live in a big house, it means you can afford to. If you can't afford to , you sell it.