If Reeves isn't stopped, every inch of Britain will be the property of the state

Telegraph

a day ago

The pitch rolling has started. The propagandists have been unleashed. We are being softened-up for the ultimate betrayal, the most obscene of broken promises, the grossest attack on private wealth in living memory.
If you are a homeowner, I have grim news: Rachel Reeves has just declared war on you. You could pay even more tax, so much so that in some cases you may be forced to sell your house to pay the bill – and then to hand over yet more cash just to be allowed to say goodbye to your beloved family home.
Reeves is considering several options, all abhorrent: an annual proportional wealth tax on the value of homes, large enough to replace stamp duty, council tax and more; the imposition of capital gains tax (CGT) on primary residences for the first time ever, albeit just on more expensive ones at first; an 'exit tax' as an alternative to CGT, payable on sale; and a revaluation of council tax, with even higher bands, including a mansion tax.
Britain is in the midst of an epic struggle between tax-eaters and net taxpayers, between those seeking to squeeze ever more out of the private sector to keep our bankrupt welfare state going a little longer, and those desperately seeking to preserve their wealth at a time of weak GDP, stagnant real wages and rocketing costs.
We have almost reached the economy's maximal taxable capacity, at least with the tools at HMRC's disposal. The bond vigilantes are circling, and Reeves has taken the UK to the brink of fiscal meltdown. Her party won't allow her to cut spending, so she is turning to the last untapped El Dorado, the final pot of cash ripe for raiding: our homes, worth trillions of pounds in total. If she goes down, she wants it to be in a blaze of Left-wing glory, taking out the forces of conservatism's last bastion and scoring the greatest victory for socialism since the glory days of Hugh Dalton and Sir Stafford Cripps.
Primary residences have long been the great tax taboo, the last line of defence against predatory politicians: no government has been able to directly tax their gains in value or to impose an annual levy (a property wealth tax) over and above council tax.
Slapping CGT on primary residences or an annual property wealth tax based on the value of one's home isn't some minor technocratic tweak to the tax system to make it slightly more 'efficient' or 'fair': it's an attempt at dynamiting the foundations of our society, to drastically curtail the power of the petite bourgeoisie, and to enshrine the political class's supremacy.
Unlike with ISAs or pensions, whose tax-beneficial status are understood to survive at the Chancellor's discretion, primary residences are an Englishman's tax-free castles, for which we assume we have a natural right not to be taxed. This is one of the last in-built libertarian assumptions in British society, and the reason why Reeves's proposed tax 'reforms' are so pernicious.
Tim Leunig, who advised Rishi Sunak and whose Left-wing ideas are also proving attractive to Reeves, is advocating for a 0.44 per cent levy on homes worth up to £500,000 to replace council tax. He simultaneously wants stamp duty to be replaced by a 0.54 per cent annual tax on homes above £500,000, with an extra 0.28 per cent supplement on values over £1m. These would be revenue-neutral, which wouldn't be good enough for Reeves: she wants to raise billions more. The rates would need to be even higher.
I loathe council tax and stamp duty, but this idiot savant scheme would create Britain's first annual wealth tax, levied on a stock of illiquid assets, and would prove even worse. Property rights would be abrogated, and homeowners downgraded into leaseholders, paying the state-cum-landlord a fee for the right to keep living in our homes. The ancient tradition of the yeoman freeholder would be extinguished.
Many homeowners would end up paying £7,000, £15,000 or more a year. At best, there would be no money left for holidays or school fees; at worst, total tax bills would exceed 100 per cent of annual incomes. Pensioners and the cash-poor would be forced to sell. Many would pray their house didn't increase in value, and halt repairs and enhancements. Some would tear down garages or annexes to reduce their annual tax, or allow homes and gardens to fall into disrepair to influence assessors. Entrepreneurs, rich investors and the last non-doms would flee the UK. We should scrap stamp duty, but by cutting spending, not by introducing this repulsive new form of larceny.
Imposing CGT on primary residences would be almost as toxic. Like every new tax, invariably pitched to us as limited in scale and scope, it would soon be extended, in this case to ever more homes. The rates would soon be equalised to that on income. Eventually, it would become impossible to make any gains from property at all.
Tax used to be only payable on real capital gains, not on inflationary increases. Labour largely ended that key protection; the Tories scrapped the last safeguards. Inflation, now at 3.8 per cent, is once again a silent thief, delivering what Milton Friedman described as 'taxation without legislation' on a grand scale.
Under Reeves's plans, homeowners would pay tax on phantom inflationary gains and in many cases lose money in real terms. This would be especially true in London, where real, as opposed to nominal, property prices are often lower than they were a few years ago. It would be barely concealed theft. Buying a house would become a high-risk gamble.
Homeowners who haven't kept every receipt would face tax bills for their recently completed new kitchens. More generally, there would be far fewer future home improvements and extensions as the post-tax payback would be lower. Nobody who didn't have to sell their home would do so, especially with the prospect of a Reform government reversing the raid. The housing market would implode.
This war on homeowners is a bridge too far, a leap into proto-Marxist hell. Reeves is seeking to pauperise the middle classes. Taxpayers must make their fury known, write to their MPs and take to social media. This is the final battle, the fight to end all political fights: the Chancellor must be persuaded to change her mind, or else there will be no hope left for this country.