Clegg tells voter: 'remortgage' your home to pay mansion tax
Deputy PM defends tax and tells owner of £5m house it's unfair he should make 'pure profit' on rising value
NICK CLEGG told a caller to his radio show today that he should consider "remortgaging his house" if the Liberal Democrats' controversial mansion tax is implemented.
The caller to the Deputy PM’s Call Clegg show on LBC said he would be forced to sell his house if the Lib Dems' proposed mansion tax is introduced because he bought it many years ago and it was now worth £5 million. The Liberal Democrats want owners of houses worth more than £2 million to pay a 1 per cent levy, so a £5 million house would attract an annual charge of £50,000, according to Bloomberg.
Clegg countered by saying it was unfair that the caller, identified as John, should be able to make a "pure profit" from the increase in value of his home. He suggested the caller could re-mortgage his house to cover the cost of the levy.
"If he has a smaller mortgage and has got an estate worth £5 million you can try and leverage that value for your own purposes anyway," Clegg told his listeners. "Surely it is not fair on many, many people on ordinary incomes in much lower-value properties that they are paying the same council tax as a multi-million-pound oligarch."
Although he gave a vigorous defence of the tax today, Clegg said he would consider "opt-outs" from the scheme for people who were retired or who have lived in a property for a long time "and obviously aren’t in a position to pay that kind of levy every year".
Last week Labour leader Ed Miliband said his party would adopt the mansion tax policy if elected and use it to reinstate a 10p tax band for low earners. The announcement was widely seen as a move to build bridges between Labour and the Lib Dems ahead of the next general election, but Clegg described Miliband’s initiative today as "blatant plagiarism".