The Guardian has noted:
Angelina Jolie could be deterred from UK move by mansion tax
and:
Celebrity said it ‘would be really nice to have a foothold here for work' but may be put off by tax on houses worth over £2m
Now, we know that Dame Angelina got her title for services to William Hague but this is taking matters a little far. Apparently the opinion of someone who might want 'a foothold for work' here but is not actually resident, and who is unlikely ever to be so, let alone become domiciled, apparently matters enough to be reported as a matter of significant UK political concern.
Well, if that's the case then let me contextualise this, and offer a response. First, Angeline, there are a lot of people already here and who have rather more than a foothold in UK work who would dearly love a house in this country; any house; and can't get one. That's in no small part because people like you have dragged London house prices way out of any scale that they will ever be able to afford. And all you want is to use them as a 'foothold', and not live in them.
Second, we only really want people to come here if they are willing to pay our taxes chosen by our democratically elected government. If you don't like that, please don't bother to create a foothold or anything else as we think paying tax is the obligation that arises from any such presence.
Third, if you want a foothold, we have them; they're called hotels. You're very welcome to use them. I am sure we have some that will charge as much as you want to pay, although I've never been to them.
And last, you've done some good work internationally. Knowing when to stop the commentary is, however, part of the art of being effective. This time you went too far, and it won't help the causes you do promote, successfully.
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Rather than create a new wealth tax that targets one particular form of wealth, residential property – would it not be better to look at the reliefs available for that property in existing taxes such as CGT?
A broad tax base is needed
I would look at both
The UK Government looked at wealth taxes in detail in the 60’s and 70’s. Eventually Dennis Healy concluded that the combination and Estate Duty and the two forms of CGT that then existed with sufficient. Estate Duty has been replaced by IHT and is charged at 40% and CGT is now charged at 28% (18% for lower rate tax payers).
In reaching that decision, Healy and the then Treasury concluded that the benefits of wealth taxes were outweighed by the costs. The removal of wealth taxes from other jurisdicitons in Europe suggests that they have now reached the same conclusion.
One of the advantages of CGT is that it is a tax on a transaction (real or supposed) – usually where the taxpayer has the money to pay the tax. The advantage of IHT is that it is a tax on an estate where the usual objective of the executors is to gather in the estate and distribute the estate to the beneficiaries.
The obvious solution, if you believe that real property is not sufficiently taxed in the UK, is to look at where the taxes that do exist fall and decide how to increase the tax take. To me, additional bands for Council tax and looking at the reliefs available for CGT.
Inventing new taxes that are not taxes on transactions do not appear to me to be an obvious solution. Why this particular form of wealth? Why not other wealth? Why not exempt the principal private residence as it is a cost not an investment? The potential distortion on the market and so the values is also an issue – have a look at the distorting effect on values of the increase from 5-7% that SDLT has on sale prices around the £2million mark.
The real argument against wealth taxes was offshore evasion
I am not saying that has gone, but it is going
I think they are viable now
“we know that Dame Angelina got her title for services to William Hague”
What a sour comment. I thought it was awarded in recognition for her work to end warzone sexual violence.
“but is not actually resident, and who is unlikely ever to be so, let alone become domiciled”
So you’d criticise someone living here who didn’t renounce their domicile of birth? That’s not exactly an easy step to take, is it?
Your whole article seems somewhat petulant. All she said when asked a question she probably wasn’t expceting was that it MIGHT put her off.
My piece was very clear: she has done useful work
But so have lots of people and they do not get honorary damehoods because they don’t flirt with William Hague
As for domicile – you can have whatever you like, just don;’t use it to avoid tax is what I am saying
Far from being petulant I am making the point we really do not need more tax exiles in London inflating prices and distorting the economy in ways that are decidedly harmful
“As for domicile — you can have whatever you like, just don;’t use it to avoid tax is what I am saying”
So you admit it clearly: you can still be a tax avoider if you are complying with both the letter and spirit of the tax legislation. It’s time to rip up that definition of tax avoidance, throw it in the bin, and start again Richard.
Interesting point…
This illustrates the continued ‘social de-coupling’ that takes place when people become rich enough to purchase £2 million homes. And then to top it all, they cannot see the relationship between the lack of tax base and the necessity of them getting involved in ‘good causes’ in the first place.
Everything I’ve seen Jolie get involved in can be traced to a lack of resources caused by a lack of funding (lack of adequate health care, lack of infrastructure, lack of education opportunites, etc., etc). These are all things that can be built up and maintained by a decent tax system. Does Jolie think that she is needed because of an act of God? Fate? Bad luck? Just what is going through her head?
But let’s also remember that the expensive house is not a home at all – it is actually being treated as an investment which at the moment appears to be an untaxed hedge against wider inflation.
John Snow asked her about this on C4 news last night and I don’t think her response matches the one reported in the Guardian. I can’t remember her exact words but I took her response to be “if there’s a tax there’s a tax”. There was no threat to steer clear.
I think it’s a reasonable position to be not jumping for joy at an additional tax and to acknowledge it as a factor in choosing where to maintain an international foothold. What came across more was the impression that she thought it would probably still be desirable to be here.
I too heard her on C4 News, which I remembered after seeing the Telegraph piece re same posted on Facebook. I guess by the time of the TV chat she had had time to reflect on what she had been prompted to say by the Torygraph and had already received some flack.
Interesting….
he he “people like you”…
Now Richard surely this raises a good opportunity to inform and then to get Angelina to be a Tax Justice ambassador?! Why that would raise awareness to no end. There must be one celebrity or another desparate to denounce Bono aid and say instead they would just like to pay their tax!
It is ironic that so many commentators of a predominantly socialist leaning should wish to curtail the freedom of thought and expression of somebody who has spent so much time campaigning for Amnesty.
She can say it
We can express disgust
an amazing number of people have been flushed out by this , even Bill Oddie who’s come out against ! ! !
Bill Oddie could be wrong
And the Green’s land value tax may well cost him more
I don’t understand why it is disgusting. Wouldn’t you take property taxes in account when buying a property? I certainly would. As a non-resident, it seems unlikely taxes would provide her with any benefit, so it’s equivalent to a price increase. Even if you think she should give more to charity, I doubt the UK treasury is the best avenue for charity contributions.
Do you really think she is damaging the UK public by buying a property here? It seems to me she would be a net benefit. It’s very similar to an export. Someone had to build/renovate the property she would purchase. Plus she is paying like 7% stamp duty. And CGT if she makes a profit…
Oh come on: it’s suggested she was talking about buying a £25 million property
If she can’t afford to run it she should not buy it
I have heard there are cheaper options
Unless I’ve misunderstood, you’re not simply expressing disgust. You’re seeking to curtail her from expressing herself as she wishes.
‘Knowing when to stop the commentary is, however, part of the art of being effective. This time you went too far, and it won’t help the causes you do promote, successfully.’
I’m offering advice
She is at complete liberty to ignore me and no doubt will
But her comments show a lack of wisdom in my view
I’m entitled to that view
You right wing libertarians should agree we left wing libertarians also have rights, I’d have thought
Even more ‘ironic’ (or is that moronic) that so many of a right-wing political persuasion seem to conflate legitimate critique or, or comment upon their various pronouncements, with some sort of attack on their rights of free speech and free thought (whatever the latter is).
For clarities sake; you’re free to believe, think or say whatever you like. Everybody else is free to critique and comment in response. That is your right of free speech, and it isn’t being trampled on, neither here nor anywhere else. If you think otherwise, you’ve fundamentally misunderstood precisely what ‘free speech’.
Agreed
But most on the right have no idea what these freedoms mean
Just like they do not understand my right to editorial freedom
One thing I’ve been confused by in all this is, why does Jolie (or Klass, who rents her place for £8k per month) just have to live in a house worth more than £2m?
There are plenty of nice properties, even in London, going for less than that.
Precisely…
So you’d approve if she moved here and avoided the mansion tax ?
I have no idea what you’re asking
I don’t have any sympathy for this lot. They’re essentially being asked to pay a higher band of council tax (I’d far prefer a more fundamental reform of the system, towards an LVT for example). Do they honestly think that people living in properties rated as band A-H don’t have to consider the impact of council tax and (if their budgets dictate) move? Why should the great mass of people in this country be called upon, as they so often are, to live within their meansâ„¢ whilst the mansion dwelling elite are given what amounts to a massive tax break (in council tax) and defended by the dolts of Fleet Street at the mere mention of a mansion tax (or an LVT).
Personally, if I had over £2M locked up in an over inflated (and most likely oversized) property in central London, I’d voluntarily opt to trade down (and downsize) and release some of that equity. I’m sure I could find better uses for it. Of course, I’m not some avaricious turnip who sees their home(s) as little more than an investment and whom gives little thought to the absurdity of monopolising vast swaths of land and residential property in a midst of a housing crisis.
I agree…they also ignore all those who have had to move for the bedroom tax
In this country we almost exclusively tax income. In Germany they tax property.
If we taxed property higher, this would not only be a fairer way of revenue but would encourage Britons to see rising house prices as a negative thing, which, of course, they are for most of the population.
People may ask why I always choose Germany & the answer is because they get right all that we get wrong from engineering to education to foreign languages to taking penalties.
I have an edition of the European Commission Tax Papers which says otherwise. It states that the UK gets almost twice as much from property taxes as the next country, Sweden. I suspect it’s not accurate, but it could be explained by the fact that our business rates are very high.
That’s an idea. Just tell them it’s a spare room tax; the larger the room, the greater the tax. All spare rooms included, of course, not just bedrooms. After all, the window tax was on every house, not just those of the poor. In fact the rich had more windows, so paid more tax.