London, March 29: The British government may bring in new legislation that allows taxing the rich based on the value of their properties in return for a discount in the top rate of income tax.
Business Secretary Vince Cable said the government is examining a plan that will change the current income-based taxation methods in favor of property-based taxation.
The proposal by the Liberal Democrat cabinet minister may be a revival of Lib Dems’ former idea of a “mansion tax”, which suggested extra levies for people who own residences worth more than £2 million.
“It needs to be a change which is fair overall and does take account of the fact that the wealthy have got to pay their share. And the emphasis may well have to shift from high marginal rates of tax on income which are undesirable, to taxation of wealth, including property,” Cable said.
He also said that Britain needs “to have a proper base for taxing property”.
While the plans are expected to face opposition from Tories if not the Liberal Democrats living in expensive ‘mansions’ outside London, Cable said he has Chancellor George Osborne’s backing for pushing ahead with the new taxation method.
Osborne did suggest a new levy on the luxurious residences in his budget last week.
“As well as reviewing revenues from the 50 percent tax rate, we will also be redoubling our efforts to find ways of ensuring owners of high-value property cannot avoid paying their fair share,” he said.
Back in 2009, Cable told a Liberal Democrat conference that those owning houses worth more than £1 million should pay a 0.5 percent levy on the value of their property annually.
——–Agencies