Charge the Mother-in-law for a visit?
It has been reported that the OECD (Organisation for Economic Co-ordination and Development) is recommending a ban on the scandalously high rate of UK Stamp Duty. We at Bitter Wallet are no more fans of paying extra when already spending a shedload on a pile of bricks and mortar than the next man, but we viewed this claim with some suspicion, knowing (as we do) that UK levies are, in fact, amongst the lowest around the world. Yes, you did hear me correctly.
In fact, if you look at this table detailing the total buyer and seller transactional costs in OECD countries, the UK is only beaten by Iceland and Denmark in its cheapness.
What the recently released OECD report actually said was that taxing property on a transactional basis may have limiting effect on mobility, but that in the UK, lack of housing stock was probably a more significant factor. But then, who wants to move house in the current market anyway?
The real story in the OECD report is their recommendations for annual housing charges instead of transactional ones. Of course, we do have Council Tax, but this is marketed as a contribution towards the cost of the fire service, police force and bin men, rather than an annual charge just for the hell of it. The OECD are critical of Council Tax being based on such outdated figures, but more worryingly, they would like to see owner-occupied housing taxed in the same way as other 'investments'.
That’s right folks, the good people at OECD would like us to pay tax on an imputed rent for our homes. They want us to charge ourselves rent, and then tax ourselves on those fictional rents we have just not paid ourselves in order to combat the “unequal fiscal treatment between housing and other investments”.
Er, thanks, but no thanks.