Official: Government Policy On C G T

[Realistbear]

Thank you for taking the time to contact me about Capital Gains Tax (CGT).

I note your concern about future changes to CGT.

We have always said that one of our top priorities is getting Britain open

for business again. We understand how important it is to encourage

enterprise in our country, and we believe that high marginal tax rates

damage the economy and undermine growth.

The commitment we have made in the Coalition Agreement is to

raise a

modest amount of revenue from raising the rates of CGT on non-business

assets closer to the rates of income tax.

All of this revenue will be used

to increase the income tax threshold, helping to lift millions of people

out of income tax altogether and improving incentives to work. Our

long-term ambition is to raise the income tax threshold to £10,000. The

benefits of this will be focused on those with low and middle incomes.

There are a range of options to be considered before any changes to CGT

are made and it will be important to work to get the detail right. There

are genuine concerns about the difference between the rate of CGT (18 per

cent) and income tax (up to 50 per cent) and the scope this provides for

tax avoidance by changing income into capital gains. As we said in the

Coalition Agreement, there will be generous exemptions for entrepreneurial

business activities.

It is also important to note that there is an existing annual threshold of

£10,100 for capital gains, and any gains below this level are tax-free.

This means that the vast majority of people pay no capital gains tax at

all when they sell shares or other assets. Our aim is to encourage saving

and responsibility, not to penalise it.

I will write to you again soon.

Kind regards.

Yours sincerely

Simon Kirby MP

(Brighton Kemptown)

The BIG question: is property speculation/BTL/multiple home ownership a business within the scope of the intended exemption. The ordinary meaning of business use would encompass all of these mischievous enterprises that have proven to be the source of the trouble we now find ourselves in.

I suspect MPs are sending our standard form letters as above as the leaders have not yet made up their minds how hard to hit HPI related assets when they are disposed of.

If I were on the job, so to speak, I would only levy CGT at the same rate as IT for BTL, multiple home ownership sales and keep the sale of investments in shares at current levels plus 2% to bring the rate to 20%. I would remove all tax advantages associated with BTL and multiple home ownership and add a surcharge of 10% rising to 90% for each home owned by way of local taxes (Council tax). For example, if you own a second home in the country you pay a surcharge of 10% on your council tax. If you own 2 such homes you pay 20% on both and so forth rising to 90% if you own 9 or more homes. This will help local authorities raise revenue and discourage village and suburban blight caused by non-resident homeowners.

[LittleSteroid]

make sense to me . Houses are for living not for making many on them.

[Blod]

The section in bold is the contentious bit, as pointed out in other threads and comments sections of the MSM. It’s whether the coalition believes that reducing multiple home owners’ income would affect the economy. The representatives of these Vis are trying to imply that they are the economy, everyone knows they aren’t. A bit like Gordon Brown talking about the cuts. It’ll be very interesting seeing what finally happens as it’ll indicate whether Clegg/Cameron are as good as their word or just the same as Nulabour.

[Realistbear]

The section in bold is the contentious bit, as pointed out in other threads and comments sections of the MSM. It’s whether the coalition believes that reducing multiple home owners’ income would affect the economy. The representatives of these Vis are trying to imply that they are the economy, everyone knows they aren’t. A bit like Gordon Brown talking about the cuts. It’ll be very interesting seeing what finally happens as it’ll indicate whether Clegg/Cameron are as good as their word or just the same as Nulabour.

Sad to say--I think BTL/multiple home ownership/property speculation IS the economy.* DC needs to break it in order to fix it. Bit like a misaligned leg after a botched fracture repair.

Remember a couple of years back when the ONS said UK Plc was worth about 8 Trillion pounds 40% of which was property. It is our largest "industry" which is why it brought the banks down. A much needed 50% drop from the top will wipe out more than 1.5TR in lost property investment money. Probably why the politicos will try to keep HPI going.

[Pent Up]

When did you recieve the reply? How long did it take. Me and the mrs have written four letters between us and not a peep yet.

[South Lorne]

Sad to say--I think BTL/multiple home ownership/property speculation IS the economy.

....it is a superfluous waste of bank lending and many MPs took full advantage ...time Cameron and Cable stopped this immediately and restricted bank lending to various chosen business sectors to get employment moving ....and implement the lending guarantee schemes discussed by the Tories before the election .....where is it ...?..get a grip.....