First, wasn’t there a pre-existing system for services charges for new builds that people building houses were obliged to pay, and that varied according to the size of the building and the location? That – as far as I know – was more aligned to costs. And it was very clearly, of course, a very substantial property tax that got away with it because the payment tended to get buried in 100% mortgages.
Second, do you know how market value is proposed to be calculated? Is it self-assessed?
@Anthony, yes there is a charge levied by local authorities, it’s referred to as ‘contributions’, and it is based on square meter-age but has (normally) different subsections, there is a base price then an add-on if you plan to use mains sewage and another if you plan to use mains water. There are many different ways that tax is embedded. You have VAT, Stamp Duty on the final product, Part V contributions, connection fees etc. A massive portion of a property transaction is tax.
This means a house purchase is far more expensive than needs be, it would be far better to have an annual tax that isn’t as pro-cyclical as the former mentioned revenue raisers.
Two points.
First, wasn’t there a pre-existing system for services charges for new builds that people building houses were obliged to pay, and that varied according to the size of the building and the location? That – as far as I know – was more aligned to costs. And it was very clearly, of course, a very substantial property tax that got away with it because the payment tended to get buried in 100% mortgages.
Second, do you know how market value is proposed to be calculated? Is it self-assessed?
@Anthony, yes there is a charge levied by local authorities, it’s referred to as ‘contributions’, and it is based on square meter-age but has (normally) different subsections, there is a base price then an add-on if you plan to use mains sewage and another if you plan to use mains water. There are many different ways that tax is embedded. You have VAT, Stamp Duty on the final product, Part V contributions, connection fees etc. A massive portion of a property transaction is tax.
This means a house purchase is far more expensive than needs be, it would be far better to have an annual tax that isn’t as pro-cyclical as the former mentioned revenue raisers.