This article is from the source 'bbc' and was first published or seen on . It will not be checked again for changes.

You can find the current article at its original source at http://news.bbc.co.uk/go/rss/-/1/hi/uk_politics/8265821.stm

The article has changed 13 times. There is an RSS feed of changes available.

Version 7 Version 8
Lib Dem plan for £1m-property tax Lib Dem plan for £1m-property tax
(30 minutes later)
The Lib Dems are outlining plans for a tax on owners of £1m-plus homes, using the proceeds to help low-paid workers. The Lib Dems have outlined plans for a tax on owners of £1m-plus homes, using the proceeds to help low-paid workers.
Treasury spokesman Vince Cable says plans for a 0.5% annual levy on the most expensive homes will raise £1bn.Treasury spokesman Vince Cable says plans for a 0.5% annual levy on the most expensive homes will raise £1bn.
He told the BBC, ahead of his party conference speech, it would help fund plans to get four million people who earn less than £10,000 out of taxation.He told the BBC, ahead of his party conference speech, it would help fund plans to get four million people who earn less than £10,000 out of taxation.
Mr Cable is warning party members of "unpopular" choices on tax and spending and to brand the Tories as "dishonest". Mr Cable warned party members of "unpopular" choices on tax and spending and branded the Tories as "dishonest".
The new charge of 0.5% would apply to the value of a property above £1m. So if a home was worth £1.5m the 0.5% tax would apply to £500,000 of it, meaning the owner will have to pay £2,500 a year. The extra tax on a £4m property would be £15,000 a year.The new charge of 0.5% would apply to the value of a property above £1m. So if a home was worth £1.5m the 0.5% tax would apply to £500,000 of it, meaning the owner will have to pay £2,500 a year. The extra tax on a £4m property would be £15,000 a year.
The Lib Dems say about 250,000 property-owners would pay about £4,000 a year each on average mostly in the South-East of England. The tax would be based on Land Registry valuations. The Lib Dems say about 250,000 property-owners would pay about £4,000 a year each on average mostly in the South-East of England.
People on low incomes, who are currently receiving council tax benefit, would be exempt, although the party has stressed it does not believe there are many low income people living in million pound homes. But the party is facing questions about how it will work in practice after officials admitted they did not know whether the new tax would be based on Land Registry figures, based on house sales, or whether local authorities would have to carry out new valuations.
There is also a question mark over whether it would apply to the whole of the UK, as the party wants, because it would need separate legislation in the Scottish Parliament.
£1M HOME TAX PROPOSAL 0.5% annual levy on homes worth more than £1mAbout 250,000 people affectedMostly in South-East of EnglandProperty-owners would pay £4,000 a year on averageExemption for those on low incomes£1bn would be raised£1M HOME TAX PROPOSAL 0.5% annual levy on homes worth more than £1mAbout 250,000 people affectedMostly in South-East of EnglandProperty-owners would pay £4,000 a year on averageExemption for those on low incomes£1bn would be raised
Mr Cable wants the new tax, which would be collected by local authorities, to apply to the whole of the UK - but it would need to be passed by the Scottish Parliament, which has responsibility for local government.
Speaking on BBC Breakfast, Mr Cable said: " We're talking about this proposal to raise money, to cut taxes on people who are at the bottom end of the income scale or on average income.Speaking on BBC Breakfast, Mr Cable said: " We're talking about this proposal to raise money, to cut taxes on people who are at the bottom end of the income scale or on average income.
"Our overall tax proposal is about lifting four million people - workers and pensioners - out of taxation and cutting taxes for people at the bottom end in a fair way.""Our overall tax proposal is about lifting four million people - workers and pensioners - out of taxation and cutting taxes for people at the bottom end in a fair way."
Party leader Nick Clegg told the BBC he felt the mood had shifted over the past ten years: "I think people, even at the top end, now accept we need to try and rebalance things a bit so that everyone moves together - the whole of society moves together."Party leader Nick Clegg told the BBC he felt the mood had shifted over the past ten years: "I think people, even at the top end, now accept we need to try and rebalance things a bit so that everyone moves together - the whole of society moves together."
He said the reason for the new tax was "fairness" and rebalancing "one of the most unfair tax systems around".He said the reason for the new tax was "fairness" and rebalancing "one of the most unfair tax systems around".
"This is a small correction which I think will make a big difference for people who are really struggling to make ends meet," he said."This is a small correction which I think will make a big difference for people who are really struggling to make ends meet," he said.
Party officials have stressed the new tax would be a "temporary" measure until it was able to implement its plans for a local income tax.Party officials have stressed the new tax would be a "temporary" measure until it was able to implement its plans for a local income tax.
War of words People on low incomes, who are currently receiving council tax benefit, would be exempt, although the party has stressed it does not believe there are many low income people living in million pound homes.
Revenue neutral
Lib Dem leaders have turned their fire on the Tories at their annual gathering in Bournemouth, arguing they cannot be trusted to tell the truth on spending and are posturing about planned cuts without being prepared to give details.Lib Dem leaders have turned their fire on the Tories at their annual gathering in Bournemouth, arguing they cannot be trusted to tell the truth on spending and are posturing about planned cuts without being prepared to give details.
While saying he cannot rule out that the overall burden of tax will rise in the future, Mr Cable will say his latest measures are revenue neutral.While saying he cannot rule out that the overall burden of tax will rise in the future, Mr Cable will say his latest measures are revenue neutral.
The levy will target anyone with a home worth more than £1mThe levy will target anyone with a home worth more than £1m
The Lib Dem conference, its last before the next general election, is being dominated by a debate on how far the party's proposed spending cuts should go and which areas should be protected from the squeeze that all parties accept is around the corner. He has drawn up detailed proposals of their own for potential cuts, including scrapping Trident and other defence contracts, removing tax credits from higher earners, cutting NHS bureaucracy, freezing public sector pay and reforming public sector pensions.
Labour and the Conservatives have been involved in a war of words over the scale of alleged cuts and tax increases each have in the pipeline. In his keynote conference speech, Mr Cable told party members that efforts to reduce record peacetime levels of debt will not be "easy or popular" and that tax increases as well as spending cuts may be needed.
The Lib Dems have drawn up detailed proposals of their own for potential cuts, including scrapping Trident and other defence contracts, removing tax credits from higher earners, cutting NHS bureaucracy, freezing public sector pay and reforming public sector pensions. "It would be dishonest and unbelievable for me to say that taxes overall should never rise," he said. "But the Liberal Democrats' starting position is to aim for fairer not higher taxes."
Student fees
Mr Clegg has said action to reduce the national debt needs to be "savage and bold" but, under pressure from some in his party to soften his approach, he has said the party will fight equally fiercely to protect frontline services in health and education.
Controversy has surrounded the party's deliberation over student fees in England with Mr Clegg saying a long-standing pledge to abolish them may not be affordable over the next four years.
Why add 'savage' to Lib Dem? Precisely because that's the word voters are least likely to associate with the party or its leader Nick RobinsonBBC political editor Read Nick's thoughts in full
Mr Cable will tell party members that efforts to reduce record peacetime levels of debt will not be "easy or popular" and that tax increases as well as spending cuts may be needed.
"It would be dishonest and unbelievable for me to say that taxes overall should never rise," he will say. "But the Liberal Democrats' starting point is to aim for fairer not higher taxes."
The party says its pledge to raise basic income tax thresholds to £10,000, which it argues will lift four million people out of tax, will cost £16bn.The party says its pledge to raise basic income tax thresholds to £10,000, which it argues will lift four million people out of tax, will cost £16bn.
"Quite apart from the economics it just wrong that people on the minimum wage should be dragged into paying income tax," he told delegates, adding: "My priority would be to cut income tax for those on low and middle incomes."
The new charges on properties valued above £1m will help pay for the measure alongside existing taxes on higher earners and a raft of green taxes.The new charges on properties valued above £1m will help pay for the measure alongside existing taxes on higher earners and a raft of green taxes.
'Arrogance''Arrogance'
Mr Cable will seek to contrast the Lib Dems' "upfront" approach with that of the Conservatives and shadow chancellor George Osborne who he will say is hiding his true intentions from the electorate. Mr Cable sought to contrast the Lib Dems' "upfront" approach with that of the Conservatives and shadow chancellor George Osborne who he will say is hiding his true intentions from the electorate.
He told a fringe meeting on Sunday he believed the Tories would put VAT up to 22.5% or even 25% if they won the next election, arguing that they "had done it before" in 1981. While the Conservatives have called for public spending to be reduced now, Mr Cable said they are also committed to policies - ranging from abolishing inheritance tax to building a high-speed rail network - that will cost more than £50bn in total.
While the Conservatives have called for public spending to be reduced now, he will say they are also committed to policies - ranging from abolishing inheritance tax to building a high-speed rail network - that will cost more than £50bn in total.
"The public doesn't need George Osborne's imaginary secret documents or conspiracy theories to work out that the public finances are in a bad shape.""The public doesn't need George Osborne's imaginary secret documents or conspiracy theories to work out that the public finances are in a bad shape."
"No-one does political cynicism better than the Tories. They pose as tough guys cutting spending sooner and deeper than anyone else."No-one does political cynicism better than the Tories. They pose as tough guys cutting spending sooner and deeper than anyone else.
"But we have just exposed them as committed to a massive £53bn of extra spending - more than the total defence budget."But we have just exposed them as committed to a massive £53bn of extra spending - more than the total defence budget.
"If we did that we would be accused of being fantasists or dishonest. But these people are so arrogant they think they can cruise into Downing Street without anyone noticing.""If we did that we would be accused of being fantasists or dishonest. But these people are so arrogant they think they can cruise into Downing Street without anyone noticing."