Coalition divided over Cable's plan for land tax
Andrew Grice has been Political Editor of The Independent since 1998. He was previously Political Editor of The Sunday Times, where he worked for 10 years, and he has been a Westminster-based journalist since 1982. His column, Inside Politics, appears in The Independent each Saturday.
Monday 29 August 2011
a split between Conservative and Liberal Democrat ministers emerged yesterday as Nick Clegg's party demanded higher taxes on land and property to hit the rich.
Vince Cable, the Liberal Democrat Business Secretary, who has already proposed a "mansion tax" on homes costing more than £2m, floated the idea of a "land tax".
Tory MPs dismissed the proposal as unworkable and fear it could alienate the party's natural supporters. It is likely to be vetoed by George Osborne, the Chancellor.
Mr Cable insisted that Britain needed a proper examination of how a land tax could work. He said, "Income tax for high earners is becoming difficult to enforce. The traditional tax bases have been eroded and land tax is one thing you can't take off to Monaco."
He suggested that business rates could be replaced with a tax based on the value of the site, and council tax replaced by a property tax calculated annually on the value of the land.
Mr Osborne set out a very different agenda yesterday as he limited his aspirations to hitting the rich to a further clampdown on tax evasion. "Those who evade taxes, like benefit cheats, are leeches on society," he said. He promised further measures to track down money held offshore following last week's deal with Switzerland which will raise more than £5bn for the Treasury.
The Chancellor wants to scrap the 50p top rate of tax on earnings above £150,000 a year but the Liberal Democrats will demand a price – other taxes on the rich. A land tax is thought unlikely but there could be higher council tax bills for the most expensive properties. The Liberal Democrats want to go further. They warn it would be hugely damaging for the Government to abolish the 50p rate at a time when the incomes of low- and middle-earners are being squeezed. Demands for higher taxes on the rich will be made at the Liberal Democrat conference next month.
- 1 Drugs Live cannabis trial: Hash is less harmful than any other drug, expert claims
- 2 Have sex with your iPad thanks to the new sex toy no-one asked for
- 3 The 'sex selfie stick' lets you FaceTime the inside of a vagina
- 5 Why you're almost certainly more like your father than your mother
Out-of-touch MPs ‘don’t get it’, says ex-Civil Service chief
Mark Zuckerberg: Facebook CEO's one simple test for who to hire
Bali nine: Welcome to 'Execution Island' – the Indonesian holiday resort where foreigners are sent to die
'A girl is more responsible for rape than a boy': The statement that shocked the world... except India
The 'sex selfie stick' lets you FaceTime the inside of a vagina
Durham Free School: 'Creationism taught at' free school facing closure
Nearly 100,000 of Britain's poorest children go hungry after parents' benefits are cut
Ukip would cut billions from Scottish budget to fund English tax cuts
End of the licence fee: BBC to back radical overhaul of how it is funded
Ukraine crisis: Top Chinese diplomat backs Putin and says West should 'abandon zero-sum mentality'
Boris Nemtsov shot dead: Outspoken Putin critic who had expressed fears for his life is killed near the Kremlin
£45000 - £55000 per annum + benefits: Ashdown Group: Senior VMware Platform En...
£10000 - £16000 per annum: Recruitment Genius: A distributor of specialist ele...
£17000 - £19000 per annum: Recruitment Genius: A distributor of specialist ele...
£32000 per annum + pension, healthcare & 23 days holiday: Ashdown Group: A gro...