No 'mansion tax' following historic coalition pact
Date:
Wednesday 12th May 2010
The Liberal Democrats proposed 'mansion tax' will not be introduced after the new Prime Minister David Cameron agreed not to increase the inheritance tax threshold.
The Liberal Democrats wanted homeowners to pay an annual tax of 1% on homes worth at least £2m.
This is just one of a number of policy compromises that the new Tory-led coalition government will have to make.
The income tax threshold is set to rise to £10,000, a Lib-Dem policy, which could save some landlords money on their net rental income.
However, capital gains tax on the sale of a property could increase from 18% to 40%.
The cost of buying a new home in the UK increased slightly for some overseas nationals this morning after the pound responded positively to Cameron becoming prime minister last night.
Sterling is up against the dollar at $1.50 and higher against the euro at €1.18 on hopes that the new coalition government, led the Conservative party, will seek to cut the budget deficit sooner rather than later. The new chancellor George Osborne is expected to set out £6bn worth of budget cuts within 50 days.
