Lib Dems reiterate Mansion Tax ambition with Election manifesto

The Liberal Democrat party has placed housing at the heart of its election manifesto, revealing plans to introduce a £100 cut in council tax for 10 years for people who insulate their home, as well as confirming that it plans to introduce a ‘mansion tax’ – originally a Liberal Democrat policy – on residential properties worth £2 million or more.

Homes worth between £2 million and £2.5 million would face an annual mansion tax of up to £2,000 a year, under Liberal Democrat plans.

Nick Clegg (left) confirmed the Lib Dems had scaled back the policy and it would now raise only £1 billion – considerably less than the £1.7 billion initially proposed.

Mr Clegg commented, “It is less than originally mooted but as we have worked up the idea, looked at what we think is reasonable and fair, we think this is a reasonable and fair way of doing it and shouldn’t scare the horses.”

The Labour Party has also proposed its own mansion tax, which would see properties valued between £2 million and £3 million paying £250 a month or £3,000 a year. The party is yet to set out details of higher bands.

The Lib Dems’ manifesto, published last week, also unveiled plans to introduce a new Rent to Own scheme, with monthly payments buying a stake in the property. The party also wants to introduce Help to Rent tenancy deposit loans to help young adults leave their parents’ home and rent a place of their own.

Other Lib Dem housing policies include a ban on landlords letting out homes that tenants cannot reasonably afford to heat, as well as plans to help residential property developers build 300,000 new homes a year, including 10 new garden cities in areas where homes are needed most.

The Liberal Democrat pledge to borrow only for productive investment in housing strikes the right balance between paying down the deficit, boosting economic growth and addressing the housing crisis, according to the Federation of Master Builders (FMB).

Brian Berry (left), Chief Executive of the FMB, said, “Like most business leaders, I’m keen to see the next government reduce the budget deficit and build a stronger economy. The Liberal Democrat pledge to only borrow for capital spending that enhances economic growth or financial stability, will not only boost the economy, it will also help address the housing shortfall. Also the Party’s commitment to ensure that investment in infrastructure, including in housing and energy efficiency, continues to rise both in absolute terms and as a share of the economy is much-needed and welcome.”

Berry added: “The Liberal Democrats have dedicated ten pages of their manifesto document to housing and have pledged to build 300,000 new homes a year to meet the current demand for new homes, while also addressing the backlog. This shows the party understands that the housing crisis is one of the greatest challenges our country faces. We particularly welcome their equal focus on improving our existing homes, which is essential if we are to maximise the existing stock and at the same time, meet our ambitious carbon reduction targets. The next Government must get its approach to new and existing homes absolutely right if we have any hope of solving the housing crisis.”