What are Rachel Reeves’ options on property tax?

Chancellor Rachel Reeves has some major decisions to move beyond the budget in November.

Economists say that he is On track to break its rules on government borrowings Unless she can find Arabs to distinguish between public spending and tax income.

To fix this, several reports have suggested that the government is considering shaking stamp duty and other property taxes – frequent income tax, employees refused to increase national insurance or VAT.

These changes can increase the billions, but also come with many types of downside.

Capital Gains Tax (CGT) is a fee on an increase in the value of an asset when you sell it.

This applies to the sale of pictures, other homes and things such as stocks and shares, but the main homes are currently exempted from CGT.

Therefore, if you have bought the main house living in £ 200,000 and sold it for £ 210,000, you are entitled to all that £ 10,000 – except for some exceptions such as for those whose main houses are more than 5,000 acres or who have given it to the Lajers.

According to The Times, the government is considering removal of this relief for prisier homes, which means that they will be subject to sales CGT, the current rates will be 24% for higher rate taxpayers and 18% for lower-by-taxpayers.

How much it will increase depends on what is the value limit for homes, to collide with tax – in the last financial year, the tax raised £ 13.3bn.

Critics argue that the removal of CGT relief for the sale of a high -value house will slow down the transactions, which means it cannot increase as much as the government would like.

Simon French, the chief economist at Panmure Liberum, told the BBC that the ax of relief would be “potentially incredibly attractive, but also incredibly controversial”.

Another change that the government is allegedly considering is the abolition of stamp duty, which is united on the purchase of houses.

Unlike CGT, it does not apply to the value of the property not on the change in the value of the tax property but when it is purchased.

House buying stamps do not pay duty for less than £ 125,000. Buyers do not pay stamp duty on assets up to £ 300,000 for the first time.

People who buy home pay more percentage of household price.

Calogon Babbock, property experts from Wrightmov, say that the tax is “a huge barrier to the movement, first from buyers to downsizers”.

However, getting rid of stamp duty would also mean that in the last financial year, £ 11.6BN was raised from the tax.

For example, reports suggest that any elimination of stamp duty will come up with other property tax changes.

The Guardian has reported that such a replacement can be taxed on the owners-businessmen selling houses with more than £ 500,000 jointly with a correction of council tax.

Council Tax is a levy that gives money to your local authority.

It is based on the property you live in was value in 1991 or – if the property was built after – what would have been the value of the property in 1991.

This is done in such a way that it is the year when the tax was introduced, but critics say this method of evaluating assets is complicated.

They also argue that – because it is calculated at a council level – there are unfair inequalities.

This means that two people living in houses with accurate value will not pay the same council tax if they live in two separate council areas.

Despite the widespread opposition to the current council tax system, for government proposals Changes in system have also come under investigation To increase money from some areas to increase money in others.

This highlights the difficulty that can face the government in trying to overhala the council taxes.

The Treasury has not commented on any recent report.

“We are committed to keep taxes as low as possible for working people,” said a spokesman.