Three decades ago, Christopher Broadbent bought an old farm worker’s two-bedroom cottage in the East Sussex countryside.
The founder of a consultancy firm carried out a “Damascene conversion” of the house, doubling its size, and bought 50 acres of farming land around it for a nature reserve and a glamping business.
But now, with his farmhouse and land thought to be worth around £2m, the 75-year-old fears he and his wife could be placed in a “profoundly uncomfortable” position by a so-called mansion tax, expected to be announced at Wednesday’s Budget.
“I’m not saying we couldn’t afford it,” said the Labour voter, “but there would be a deep sense of unease and unfairness.”
Mr Broadbent, who plans to retire next year, already pays £3,600 a year in council tax on the four-bedroom home, which sits within the top three council tax bands (F, G and H). Being within the high-end bands, under Rachel Reeves’ expected plan, it could be revalued to check if the property meets a £2m threshold for the mansion tax.
The tax, as reported by TheTimes, would see the average “mansion” paying around £4,500 a year, raising up to £500m for the Treasury.
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But there are fears the plan could impact the property market, and end up costing the government due to a reduction in sales, which also raises money through taxes.
The apparent move by Ms Reeves comes after she appeared to rule out putting up income tax, as she seeks to address a £20billion black hole in public finances.
Mr Broadbent described the move toward a mansion tax as “playground politics”, after a recent YouGov survey showed most voters back a tax on expensive homes.
He said: “Politicians have to be careful with language because the phrase mansion tax has connotations which are wrong. It essentially means “smack the rich”.
“Not everybody lives in a mansion, but plenty of people live in a house that is worth more than whatever the threshold will be. It’s a blunt instrument, a kind of punishment, really. It’s politically motivated, not realistic, particularly if it isn’t going to raise much money.
“It’s crude and I don’t think it’s going to work very well. It would be far better, simply, to do something with income tax.”
The Times reported that some 100,000 homes would be impacted by the tax, a surcharge collected through council tax bills, which would have several different rates depending on the value of the home.
The Office for Budget Responsibility, the fiscal watchdog, has reportedly suggested the move could slow down the housing market, particularly in London.
Mr Broadbent said he feared for families with large mortgages in London, who he said could see the value of their home fall as a result of a drying up of the market for high-value properties.
“It’s going to push some people into negative equity,” he said. “You might be living there with your partner and two or three children, and they go to school and everyone’s doing a living, leading their normal lives and suddenly through no fault of your own, you’re having to pay a huge tax on your house, and you can’t afford it either.”
With the exact details of the proposal on mansion tax yet to be announced, it’s uncertain if people, such as Mr Broadbent, whose land is classified as agricultural, would be able to claim agricultural relief on his property value.
He added that he was already facing being “clobbered” by future rises in council tax and business rates.
“I just don’t know [if we would come under mansion tax],” he said. “It would probably be profoundly uncomfortable [for us].”
Asked why, if he was faced with paying the tax, he could not sell up to improve his financial situation, he replied: “How would you feel about being forced to do the same?”
He added: “Homes are hugely emotionally important and particularly if they are where you’ve spent your life trying to do something good like convert to nature in pursuit of net zero.
“It seems to me a form of politics of envy and punishment, and that’s not how we should be operating.”
