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| Version 1 | Version 2 |
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| Nick Clegg: the Conservatives need to adopt the politics of fairness | Nick Clegg: the Conservatives need to adopt the politics of fairness |
| (7 months later) | |
| Victor Hugo observed that it is near impossible to resist an idea once its time has come. Last week, he was again proved right as calls for a mansion tax, first proposed by the Liberal Democrats in 2009, gathered new momentum. | Victor Hugo observed that it is near impossible to resist an idea once its time has come. Last week, he was again proved right as calls for a mansion tax, first proposed by the Liberal Democrats in 2009, gathered new momentum. |
| To the left, the Labour leadership has, belatedly, come on board. It's difficult to greet this conversion with anything other than scepticism. In government, Labour dismissed the idea. | To the left, the Labour leadership has, belatedly, come on board. It's difficult to greet this conversion with anything other than scepticism. In government, Labour dismissed the idea. |
| And they have chosen to link the mansion tax inseparably to their U-turn on the 10p tax rate, which they scrapped in office and which has since been surpassed by our 0p rate for anyone earning under £10,000. | And they have chosen to link the mansion tax inseparably to their U-turn on the 10p tax rate, which they scrapped in office and which has since been surpassed by our 0p rate for anyone earning under £10,000. |
| To the right, there are Conservative voices that now back a high-value property tax, ranging from Mark Reckless to Tim Montgomerie. | To the right, there are Conservative voices that now back a high-value property tax, ranging from Mark Reckless to Tim Montgomerie. |
| This growing support for the mansion tax may be sudden, but it's not surprising. This levy is part of the answer to the biggest question in politics today: during an unprecedented period of austerity, how should the burden be spread? As millions of ordinary families struggle on, who can plausibly argue against the very wealthy paying a bit more? As we try to build a stronger, more entrepreneurial economy, who can possibly defend a tax system that rewards unearned wealth at the expense of hard work? | This growing support for the mansion tax may be sudden, but it's not surprising. This levy is part of the answer to the biggest question in politics today: during an unprecedented period of austerity, how should the burden be spread? As millions of ordinary families struggle on, who can plausibly argue against the very wealthy paying a bit more? As we try to build a stronger, more entrepreneurial economy, who can possibly defend a tax system that rewards unearned wealth at the expense of hard work? |
| Across the developed world, property levies are the norm. And in the UK, the demand for tax fairness is not going to go away. The next election, in 2015, will be our first full-blown scarcity election: no political party will be able to duck difficult questions on further public spending restraint and tax increases to fill the gaping hole in the public finances. Tax has been the theme of the Eastleigh byelection and it is a preview of what is to come. | Across the developed world, property levies are the norm. And in the UK, the demand for tax fairness is not going to go away. The next election, in 2015, will be our first full-blown scarcity election: no political party will be able to duck difficult questions on further public spending restraint and tax increases to fill the gaping hole in the public finances. Tax has been the theme of the Eastleigh byelection and it is a preview of what is to come. |
| The Liberal Democrats started this byelection by setting out the case for fair taxes in straitened times. And as we head towards the finishing line, this remains the dominant theme. The message to Eastleigh's voters is simple: in government, we have successfully cut income tax for more than 20 million people. But multimillion-pound homeowners should pay their fair share. Send another Liberal Democrat MP to Parliament on Thursday and strengthen our hand. | The Liberal Democrats started this byelection by setting out the case for fair taxes in straitened times. And as we head towards the finishing line, this remains the dominant theme. The message to Eastleigh's voters is simple: in government, we have successfully cut income tax for more than 20 million people. But multimillion-pound homeowners should pay their fair share. Send another Liberal Democrat MP to Parliament on Thursday and strengthen our hand. |
| Under the Liberal Democrats' mansion tax, anyone who owns a house worth more than £2m would pay a 1% levy – just on the amount above £2m. | Under the Liberal Democrats' mansion tax, anyone who owns a house worth more than £2m would pay a 1% levy – just on the amount above £2m. |
| That's my party's preferred option, but others have floated an alternative: introducing new council tax bands at the top end – again, just affecting properties worth more than £2m. The current council tax bands are outdated and absurd. Right now, there are properties for sale for tens of millions of pounds around London's Regent's Park. Whoever can afford them will absurdly pay the same in council tax as a family living in a three-bed semi on the fringes of London. | That's my party's preferred option, but others have floated an alternative: introducing new council tax bands at the top end – again, just affecting properties worth more than £2m. The current council tax bands are outdated and absurd. Right now, there are properties for sale for tens of millions of pounds around London's Regent's Park. Whoever can afford them will absurdly pay the same in council tax as a family living in a three-bed semi on the fringes of London. |
| There are those on the right, of course, who will oppose such a levy in whatever form. Not on intellectual grounds – Adam Smith (the father of free market economics) supported higher taxes on property in order to reduce taxes on more industrious endeavours – but because their instincts prevent them from asking anything more from the very wealthy, even as people on lower incomes feel the pinch. For that reason, they seek to present the mansion tax as phase one in an elaborate plot to squeeze middle earners – the top of a slippery slope, leading to ever more intrusive raids on the well-off. | There are those on the right, of course, who will oppose such a levy in whatever form. Not on intellectual grounds – Adam Smith (the father of free market economics) supported higher taxes on property in order to reduce taxes on more industrious endeavours – but because their instincts prevent them from asking anything more from the very wealthy, even as people on lower incomes feel the pinch. For that reason, they seek to present the mansion tax as phase one in an elaborate plot to squeeze middle earners – the top of a slippery slope, leading to ever more intrusive raids on the well-off. |
| This is complete and utter nonsense. Despite hyperbolic reports last week, under my leadership, the Liberal Democrats will not extend the mansion tax to property portfolios, nor will we introduce new taxes on jewellery. Our whole approach to tax is about lowering, not increasing, tax bills for millions of hard-working British taxpayers. | This is complete and utter nonsense. Despite hyperbolic reports last week, under my leadership, the Liberal Democrats will not extend the mansion tax to property portfolios, nor will we introduce new taxes on jewellery. Our whole approach to tax is about lowering, not increasing, tax bills for millions of hard-working British taxpayers. |
| But I cannot reason with dogma. Instead, I offer my strong reassurance to the moderate right, to those who still seek a modern Conservative party: the mansion tax is not the politics of envy, it is the politics of fairness. It is a specific, contained reform, aimed only at rebalancing our tax system. | But I cannot reason with dogma. Instead, I offer my strong reassurance to the moderate right, to those who still seek a modern Conservative party: the mansion tax is not the politics of envy, it is the politics of fairness. It is a specific, contained reform, aimed only at rebalancing our tax system. |
| I offer clarity about the very small number of cases where a £2m house is owned by someone on a low income. Asset-rich but income-poor pensioners, for example, could roll over the levy into their estate, so there would be no effect on their day-to-day income. | I offer clarity about the very small number of cases where a £2m house is owned by someone on a low income. Asset-rich but income-poor pensioners, for example, could roll over the levy into their estate, so there would be no effect on their day-to-day income. |
| Finally, I offer certainty: the mansion tax, or a version of it, will happen. My party has often led the political debate – whether on climate change, on the recklessness in our banks, on Iraq or on gay marriage. The lesson is always the same: change is rarely possible overnight – new ideas are always met with outrage by people who cling to the status quo – but when you have the argument on your side, it's only a matter of time. The mansion tax is an idea whose time has come. | Finally, I offer certainty: the mansion tax, or a version of it, will happen. My party has often led the political debate – whether on climate change, on the recklessness in our banks, on Iraq or on gay marriage. The lesson is always the same: change is rarely possible overnight – new ideas are always met with outrage by people who cling to the status quo – but when you have the argument on your side, it's only a matter of time. The mansion tax is an idea whose time has come. |
| The Conservatives and opponents of fairer taxes have a choice. They can dig their heels in and remain stuck in the past. Or they can join with the Liberal Democrats and the chorus of voices seeking to make our tax system fair. | The Conservatives and opponents of fairer taxes have a choice. They can dig their heels in and remain stuck in the past. Or they can join with the Liberal Democrats and the chorus of voices seeking to make our tax system fair. |
| Far better, surely, to move with the times. | Far better, surely, to move with the times. |
| Nick Clegg is deputy prime minister and leader of the Liberal Democrats | Nick Clegg is deputy prime minister and leader of the Liberal Democrats |
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