Property tax will ease volatility
People that sell their houses for a profit should pay a 40% capital gains tax, a leading independent think tank has demanded.
The Social Market Foundation called for the tax to ease the volatile housing market and it also called for an annual property tax, based on the value of the property.
According to the SMF, the shortage in property is caused by people holding onto their homes, in the belief that they can make more money by waiting for prices to rise, the BBC Online reported.
To combat this, Tom Startup, author of the report on Housing, said increasing taxation would be the only effective means of combating the problem.
‘Capital gains tax on home-ownership and an annual property tax proportional to the market value of the property would be necessary to reduce volatility and restore building levels,’ he said.