Boris Johnson has scrapped government plans to introduce a mansion tax after a backlash from his party’s traditional bricks-and-mortar owning heartland.
Over the weekend the new Chancellor Rishi Sunak said it was ‘highly unlikely’ that the measure would proceed, while the Prime Minister is said to have ‘cooled’ on the idea despite heralding it last week as a key policy to enable the UK to be ‘levelled up’ economically.
But another reason for the ditching of the idea has been forming over the weekend among political commentators; that the mansion tax proposals were part of a plan by Johnson and his chief aide Dominic Cummings to oust Sajid Javid from No.11 if he didn’t go along with their plans to downgrade the power of HM Treasury.
The idea was clearly not Javid’s. As property industry figure Trevor Abrahmsohn (left) found out after attending a private meeting recently with the now former Chancellor, he is unlikely to have adopted what has been in the past a Labour policy.
“It was evident that he was a ‘fiscal pragmatist’, i.e. he believed in the notion that taxes are designed to raise as much money as possible for the Treasury, rather than being a cunning, socialist device to ‘redistribute’ wealth or penalise entrepreneurs,” he says.
Also, any form of mansion tax is not a Conservative vote winner. Research last week by The Telegraph showed that hundreds of staunch Conservative constituencies would see high proportions of home owners paying the additional tax.
Within London between 28% and 65% of homes are over £1 million while outside the capital in commuter belt towns such as Guildford or upmarket areas of Manchester, up to 24% of homes would be deemed ‘mansions’ based on price.