Shadow Chancellor Ed Balls says he will press ahead with his controversial mansion tax plans if Labour wins the next general election despite radical stamp duty reforms announced yesterday.
Under the new progressive stamp duty tax system unveiled in Chancellor George Osborne’s Autumn Statement, buyers purchasing a home valued between £2m and £3m will now face a stamp duty bill of £153,750 – an increase of £53,750 from the £100,000 charge they would have paid under the previous slab structure.
The Labour mansion tax plans would require owners of homes in that price band to pay an additional levy of £3,000 per year.
The charge would be higher for properties worth more than £3m, though details of the increased tax have not yet been disclosed. The Institute for Fiscal Studies said owners of properties valued at £3m and above would need to be hit with a tax bill of around £10,000 a year to achieve Labour’s target of raising £1.2bn annually in revenues.
In an interview with ITV today, Balls was asked if he would persist with the mansion tax in the wake of the Autumn Statement.
He said: “I think people at the top with properties over £2m aren’t paying enough tax at the moment; 95 per cent of them are not moving in any year and they should be paying more.
“I want to get some money for the NHS and I think particularly for foreign investors but for also people with very high-value properties, the mansion tax is fair.”
The mansion tax proposals were slammed by brokers as being “bonkers” and “PR fluff’ when they were unveiled in October by the shadow chancellor.