A recent proposal from the Organisation for Economic Co-operation and Development is that the Government should look to raise more money from an annual property tax rather than trying to raise existing taxes on companies and individuals. It also says that the property taxes could limit future housing market bubbles.
Probably not unexpectedly this proposal has been met with furious opposition from the property and mortgage industry. Readers of previous blogs will know that I have always been very interested in a more refined form of Capital Gains Tax for properties – in particular targeting people who regularly trade properties that are not their sole or main residence.
I do not think that another annual tax on property, which sounds very much to me like a national form of Council Tax, would be beneficial or welcome by homeowners, especially in the current economic climate. I would urge the Government to reconsider the concept of a Capital Gains Tax on properties that are sold within a 7 year period that are not sole or main residence with a graded form of Capital Gains Tax. This would have the benefit of people paying it purely from gain rather than normal income and would also be a useful tool in controlling future housing bubbles.
Head of Property Services