Think tanks suggest that homeowners should be expected to pay an annual tax equivalent to 0.5 percent of the home price, rather than a council tax. The Institute of Public Policy has proposed the idea of a “proportional property tax” to address regional inequality.
The Institute believes that those who have benefited from rising home prices over the past year have paid very little unreasonably compared to the value of their homes.
With this new system, a person living in a £ 1 million home will have to pay £ 5,000 for the value of the home.
This format is why the newly proposed system was labeled “Condominium Tax”.
In addition to replacing the council tax, there was also a proposal to replace the stamp duty currently in place when individuals return home with a new tax.
This new form of taxation is estimated to reduce home prices in areas like London by about 3 percent.
According to Rightmove, the price similarity between homes and apartments is shown in the particular area where people live.
For a one-bedroom flat in an area like Brentwood in Essex, the price is around £ 200,000.
For the same amount of money on a home in Grimsby, Lincolnshire, an individual can get a four-bed single-family home.
IPPR economist Shreya Nanda said:
According to IPPR, the Council Tax is said to be obsolete. In short, taxes paid on the most expensive homes in the country are far behind the rise in homes.
With this new rate, it is estimated that three-quarters of UK homes are paying less than they are currently paying.
IPPR states that the new system will make the housing market and taxation more equitable. This is because the lowest-income household pays about twice as much as the highest-income household, based on the percentage of income.
However, IPPR has identified that there may be practical issues resulting from these changes. This includes a new way to redistribute higher returns and is split proportionally and equitably.
Treasury sources have confirmed that there are no plans to introduce such a form of taxation.
Labor think tanks demand end of council tax in favor of new mansion tax | UK | News
SourceLabor think tanks demand end of council tax in favor of new mansion tax | UK | News