Will the chancellor cane house owners in the budget?

[IMM]

1969

1971

1973

Two of them in Tory government. Did Wilson design them?

[IMM]

Interesting, but the best system is Land Value Tax and relaxing the draconian planning system.

[IMM]

At the way the country is run and what they have.

And they do.

[IMM]

< snip brainwashed drivel >

[Andy Hall]

You might think a little differently if you had to act as executor of a complex estate during bereavement.

It is not an appropriate time to be dealing with complicated tax matters, not to mention the invasion of privacy by officaldom.

IHT should be abolished. The deceased has already paid income tax, VAT and possibly CGT and frequently has little left to bequeath, even less if long term care is required in late life.

For many of the elderly, this is a source of considerable distress because they would like to be to hand something to their children or grandchildren. For 40% of it to be ripped off by the government is not appropriate.

Earmarking of tax never really happens though.

I meant a forward looking tapering.

Well are the market conditions artificial? Prices are only based on what the market will stand and what people can afford. That will change automatically, as it always does when interest rates begin to rise. Those who are most over extended will have their wings clipped first.

I'd go along with that, and also exempt home improvement in general.

.andy

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[Andrew]

In article , IMM writes

Thanks to Maggie sorting out restrictive union practises and paying off the mountain of debt that Wilson and Callaghan accumulated. Now remind me what was Phoney telling us in April 1997; Ah I remember - "we will end the practise where employers pay shit wages of £3/hr and expect the taxpayer to make up the difference in benefits". And after nearly 7 years of 'socialism' we have many more millionaire lawyers, and

*army* of people employed by the DTI, Jag+=2 and the NHS to do precisely nothing. Meanwhile Chinese and Greek nationals are 'employing' their fellow country folk to pick cabbages in Cornwall in return for 10p a day and a tin of dog food (in the case of the Greek) and trip to seaside for the Chinese - every day, rain or shine for about the same, and a free funeral chucked in.

[Andrew]

You seem to be festering in an illusion that house prices can keep on rising at rate that is many times the RPI and that somehow this is a good thing and can go on for ever. Ask an engineer or biochemist what happens when an amplifier or a biological process loses its negative feedback - disaster, and so it is, will be, and has been with the housing market. The next 'correction' will be as nasty as any in the past. In the absence of common sense amongst the house-buying great unwashed, the only negative feedback is one of

1) higher interest rates (which we have had in the past under Lab and COn) 2) Higher unemployment (had that too under lab and con) 3) Restrictions on what you could borrow (Wilson /Callaghan loved that one - MAggie scrapped it). 4) Sudden cut in population (plague, flue, sars, meteorite)

If businesses are taxed on assets as well as profits, we should the silly smug house-owner be exempted. If the banks can be hit with windfall profits taxes so can we. Don't forget the re-rating due in 2006 - those of you dreaming of how much your house is 'worth'.

[Mike Mitchell]

If they decline much further, there will be no one around in thirty years with the ability to recognise a misspelling in Government documents or university papers, and then we shall be the laughing stock of the world. The home of the English language inhabited by people who do not know it properly.

Indeed. How long shall this new game last?

MM

[Mike Mitchell]

Ours seems to be top-heavy in the negatives.

MM

[Mike Mitchell]

Far too much fiddling at the edges. The only thing that will bring the price of houses down is to increase the supply of dwellings (not necessarily houses alone; flats both to buy and rent are a huge source of supply across mainland Europe).

MM

[IMM]

..and Tone has been trying to stop this.

[IMM]

< snip drivel >

[Andy Hall]

I suppose it depends on what you are looking for.

I prefer the glass to be half full. It's more optimistic than half empty and the reality is the same.

.andy

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[Huge]

Nope.

Nope.

I *am* a biochemist. Or at least, I was.

Quite so. See me fail to give a damn.

The market will sort it out.

[8 lines snipped]

Homeowners are not businesses.

Numbers of reasons; tradition, lots of people are using property to replace the pensions they've lost.

I have another name for windfall taxes. Theft.

I wonder if there will as much rioting in the streets as there was last time?

[Andy Hall]

on the basis of two negatives making a positive?

.andy

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[IMM]

LOL, so funny Andy.

[stuart noble]

Just doing that myself.

I've found IHT remarkably straightforward. Measures to avoid it are complex but, after the event, well, it's just give us 40% of what you were worth 7 years ago plus anything you might have squirreled in between.

If they have little to bequeath, there shouldn't be any IHT.

They can if they think ahead 7 years. It's probably well known to The Revenue and psychologists that everyone thinks they've got at least 7 years left. My late father in law started giving things away at 90. Talk about optimism!

[Owain]

"Mike Mitchell" wrote | The only thing that will bring the price of houses down is to | increase the supply of dwellings (not necessarily houses alone; | flats both to buy and rent are a huge source of supply | across mainland Europe).

The real thing to bring the price of houses down is to deflate the economy in London and the South-East and rejuvenate depressed areas. There are streets and streets of perfectly good houses being demolished in parts of the North-East of England, plenty of rural areas suffering depopulation, and other rural areas where a huge proprtion of houses are second homes.

The problem is not dwellings, it's land (as IMM would say) and the answer is not (as IMM would say) to abolish planning controls, it's to even out the population and the economy across the country. A better and cheaper mass transport infrastructure would help by rducing businesses' "need" to be in London and the SE and other city centres and increasing the magic "1 hour commute" area for housing.

Owain

[Owain]

"Andy Hall" wrote | "Owain" wrote: | >| >What about removing residency and spousal inheritance exemptions from | >| >CGT and replacing Stamp duty and allowing a tax-free gain in value | >| >per annum equal to the bank base rate, compounded annually. Any gain | >| >in value above tax-free gain taxed at 80%. | IHT should be abolished. The deceased has already paid income tax, | VAT and possibly CGT and frequently has little left to bequeath, even | less if long term care is required in late life. | For many of the elderly, this is a source of considerable distress | because they would like to be to hand something to their children or | grandchildren. For 40% of it to be ripped off by the government is | not appropriate.

Good point, so under my suggestion remove inheritance tax and do not regard transfer of ownership by inheritance as a sale. The children can inherit the house with no immediate tax liability, but the gain tax will be due when the property is next sold, if it's sold at a profit more than the tax-exempt gain.

| >Anyway, it's a marginal rate, in the example I gave it equals a tax | >of 32% on the overall growth or 16% on the curent market value, | >which compares fairly with general income tax rates or even 17.5% | >VAT. It would apply mostly to those who have a grossly-inflated | >house value through artificial market conditions, | Well are the market conditions artificial? Prices are only based on | what the market will stand and what people can afford. That will | change automatically, as it always does when interest rates begin to | rise. Those who are most over extended will have their wings | clipped first.

Because house prices have risen so unevenly across the country and have risen more than demand (population hasn't doubled in 5 years, neither has the number of households).

Yes, it's a sort of windfall tax on the sort of artificial market where people can borrow 100%+ mortgage, buy a house, live in it rent-free for a year, pay no mortgage payments, and still make a hefty profit when it's reposessed.

Owain

[Andy Hall]

I see what you are saying, Owain, but I'm not sure about the practicality of mass transportation over large geographical areas.

The time factor becomes very significant. From where I live to where my kids work is about a 10-15 minute drive. By bus it involves two buses and a journey of an hour or so, and connecting buses only run at peak times. This is basically from one town to the next. Why would I want to take the bus? It's way too inconvenient, plus I can only take what I can carry. That's before one starts thinking of issues like personal space.

Originally the large conurbations like London happened because of naturally available transport. This attracts a concentration of people who in turn attract more infrastructure. Certain industries require people to be grouped together to make something. Others require face to face interaction, although if you think about home working, that was not much known 10 years ago. Nowadays it's commonplace largely because of telecoms technology. I think that is likely to be things that reduce the need for people to move around that will open the way to more even population distribution. The more obvious things like transport I don't think will be able to do that.

.andy

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