Conservative conference: Cameron rules out 'mansion tax'

 

David Cameron: "We've capped welfare but we need to go further"

Prime Minister David Cameron has ruled out a new tax on expensive properties but vowed "further action to ensure rich people pay their fair share".

He told the BBC's Andrew Marr show new measures would be unveiled before the next election.

His statement comes as Conservative activists gather in Birmingham for the party's conference.

Mr Cameron's decision could put him on a collision course with the Lib Dems, who back such a "mansion tax".

The prime minister also said the UK is considering curbing migration from some European countries and would be prepared to veto a new EU budget to prevent "massive" increases.

Asked about an annual tax on property, he told Andrew Marr: "That is not going to happen."

He said that if people worked hard and saved, invested in a property and paid down their mortgage, he didn't want the UK to "be a country that comes after you every year with a massive great tax, and so that is not going to happen."

Chancellor George Osborne also rejected Lib Dem calls for a mansion tax - and an annual levy on wealth - saying those ideas were not the right way to make sure the rich made a greater contribution.

'Not sensible'

He told Sky News: "I don't think the mansion tax is the right idea because I tell you before the election it'll be sold to you as a mansion tax then after the election a lot of the people in Britain are going to wake up and find their more modest homes have been reclassified as a mansion.

Analysis

The conference began with a blizzard of mini announcements.

Eye-catching, popular and relatively cheap ideas, on everything from council tax to rail fares to the European Union's budget.

The idea is to focus on the cost of living for ordinary people and ram home that the Conservatives get many families are struggling.

Both the prime minister and the chancellor said there will be new plans to make sure richer people "pay their fair share".

But both also said the idea of a tax on big houses - what Westminster types call a "mansion tax" - isn't a goer.

Which begs an obvious question. What is their plan for getting the better off to pay more?

The chancellor also said he wasn't keen on a "wealth tax," adding, "in the sense of a tax on your wealth levied annually".

So that leaves some wriggle room.

Many will now ask in which direction they intend to wriggle.

"Nor do I think it's sensible to have a wealth tax in the sense of a tax on your wealth levied annually.

"But I'm very clear that the rich will have to make a contribution to closing the budget deficit."

In addition to his stance on the mansion tax, Mr Osborne is also understood to have ruled out introducing new council tax bands on high-value homes.

In his Marr interview, Mr Cameron insisted it was "too early to say" whether the government would miss its key target for public sector debt to be falling by 2015, as some experts are predicting.

Council tax freeze

But he said the Conservatives would "level" with the public about the need for another £16bn of spending cuts in 2015-16.

"We have to find these spending reductions and if we want to avoid cuts in things like hospitals and schools - services that we all rely on - we have to look at things like the welfare budget," he said.

But he promised to stand by his promise not to cut universal benefits for pensioners - such as free bus passes and winter fuel payments.

He is also announced a council tax freeze in England for the third year in a row.

And there is to be a cap on how much regulated train fares can go up by - so ticket prices will not rise by more than 1% above the rate of retail-price inflation (RPI).

Liberal Democrat leader Nick Clegg made it clear at his party's conference that he would only sign up to further cuts in the welfare budget if a wealth tax was imposed by the chancellor at the same time.

'We get it'

Questioned about Europe, Mr Cameron confirmed comments by the home secretary in the Sunday Times that a government review was looking at introducing possible controls to limit a new wave of economic migration.

He also suggested the EU should consider having two budgets - one for countries in the eurozone and one for those outside the single currency. Last year he vetoed a treaty to co-ordinate budget policies.

Opening the four-day conference, party chairman Grant Shapps suggested the Conservatives had been too "shy" about trumpeting what they had done to support low and middle-income earners in tough times.

The public were worried about the cost of "paying their bills and filling up their car" and the party had to make clear they were on "the side of every working family".

"People need to know 'they do get it'. But they are not mind readers. We need to go out there and tell them."

 

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  • rate this
    -46

    Comment number 74.

    The mansion tax is a stupid idea. It will just make rich people more inclined to leave the country, taking their money with them. Now if anybody had the slightest idea as to how the economy works, they would know that it would be VERY BAD. Im tired of people thinking that taxes on the rich is a good idea, its a stupid idea. Their mansions for example probably gave a lot of builders a job.

  • rate this
    +17

    Comment number 73.

    No mansion tax but planning to remove free TV licences from the elderly, means testing winter fuel allowance which has been frozen for years whilst fuel has spiralled out of control, and restricting the bus passes. Nothing that might harm the rich will be carried out. Telling us that millionaires pay more tax than anyone else is no argument because what is left over after tax is what counts.

  • rate this
    +149

    Comment number 72.

    A good starting point may be to make them pay what they already owe.

  • rate this
    +4

    Comment number 71.

    46. Andrew
    many wealthy people create jobs. If they all take their businesses abroad because they don't want the tax burden of operating in the UK then frankly this country will be stuffed
    +++
    Can you please explain how the Butcher, the baker and even the candlestick maker are going to take their business abroad?

  • rate this
    0

    Comment number 70.

    It's very easy for us to socialistically fulminate about this, but bear in mind that stamp duty is already paid on these properties. Furthermore, the government should be ensuring that current taxes are properly collected, not gallivanting around imposing new ones which will require more public expenditure to implement.

  • rate this
    -1

    Comment number 69.

    There have already been increases in stamp duty for higher value properties.

    Its amusingly misleading to suggest that the reduction of higher rates from 50% to 45% was giving £40k to all millionaires- when 1) that is only re income tax for those earning over £1m taxable, 2) it was more than offset by increase in capita gains & stamp duty (where the rich generate more revenue)- badly sold policy

  • rate this
    +5

    Comment number 68.

    @ 18. Stu - what on earth are you talking about? First, income tax is calculated on a per-individual basis, not a per-family basis, so one of you must be earning above around £45k. You can have a combined income of £80k and still be in the 20% tax bracket. Second, 40% is deducted from the fraction of your pay above around £45k so you will never lose out by becoming eligible for 40% tax.

  • rate this
    +3

    Comment number 67.

    Once again, our govt has shied away from getting the rich to cough up more to help the economy. It wasn't that long ago that the chancellor rewarded them (for what?) by cutting the top rate of income tax. The old school tie has not yet faded.Meanwhile, many millions of Britons are concerned about how they will pay their ever-increasing fuel bills this winter.

  • rate this
    +5

    Comment number 66.

    God forbid Wee Georgie Osbourne should pay more tax on his modest 3 bedroom semi which he has worked hard for.
    The very thought.

  • rate this
    +6

    Comment number 65.

    I'm fed up of these comments that state "if you increase this kind of tax, the rich will just leave the UK...". My opinion is: Let them! Call their bluff! If they are so disloyal and unattached to this country from whom many made their wealth, perhaps we'd be better off without them, meaning that there would be less people who lack a sense of social responsibility and social awareness.

  • rate this
    -24

    Comment number 64.

    53.Eboracum
    You've just hit the nail on the head. They pay for what they buy. Public sector workers use other peoples money to buy goods.

  • rate this
    +20

    Comment number 63.

    We are not all in this together. The 'nasty party' remains the party for the rich...and run by the rich.

  • rate this
    -4

    Comment number 62.

    32.Sandstorm 49 nickportaloo
    == WRONG
    Gordon Brown was the worst HE CAUSED THIS MESS BY BORROWING TOO MUCH, Brown was addicticted to spending, it was unpopular to raise taxes so he Borrowed, now e have to pay that back
    extra Spending at 3% GDP was causing the economy to grow at 0.3% thats not real growth

  • rate this
    -1

    Comment number 61.

    This tax shows the Lib-Dems up as exactly what they are, another Labour party and the Democrat side of the party was formed by ex Labour MP's.

    Time to vote UKIP and chuse a party that has the UK's interests at heart and n ot the EU and their own pockets.

  • rate this
    +2

    Comment number 60.

    A "fair" tax system would see everyone paying the same as a proportion of their earnings with no exceptions. The problem with the current system is it's ludicrously complicated with too many exceptions for both rich and poor. Why? Because this keeps accountants and solicitors in work. They have no intention of changing the status quo.

  • rate this
    -1

    Comment number 59.

    A mansion tax would only be fair for new purchases.
    There are loads of pensioners who bought homes 40 years ago for a pittance. The house prices went nuts and suddenly they have home worth £1 million. They aren't super rich though, and a tax on their home would not be fair.

  • rate this
    +5

    Comment number 58.

    A Council Tax Freeze means that local services will be cut, leaving Dave and George free to blame local councils for any hardship, when, of course, it's the fault of central govt.
    As for a Mansion Tax, you won't get any tax that affects the rich while George is in charge. He has no interest in fairness.
    The Tories are dismantling the state and sharing the cash amongst their friends.

  • rate this
    +3

    Comment number 57.

    Dear Mr Osbourne, Just how many poor people do you think "saved up" to buy a mansion valued over a million pounds. I understand that you would have a problem explaining mansion tax to your wealthy mates, but please don't expect anyone to believe this pathetic reasoning for not imposing it.95% of us are deep in it together. The richest 5% are laughing all the way to the bank where they work !

  • rate this
    +4

    Comment number 56.

    39. News teacher. Public sector pensions are a massive Ponzi scheme, always have been. You're paying more to make it less of a Ponzi scheme. If someone doesn't do something to sort it out no-one will get any pension at all, as the country will be bust. Labour spent 13 years with their fingers in their ears singing la-la-la and hoping the problem would magically go away.

  • rate this
    +3

    Comment number 55.

    Too many mp`s would have to pay more tax that`s what this is all about ; shameful reflection on the government , a u turn once again ; instead of Cliff singing how about Cilla " Suprise Suprise "

 

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