Published On: Thu, Aug 22nd, 2019

Jeremy Corbyn house sale plans could hike taxes and cost Britons billions of pounds | Politics | News

The opposition leader is desperately trying to accelerate his efforts to wrestle power of 10 Downing Street from the Conservative Party and oust Boris Johnson as the country’s next Prime Minister. He plans to table a motion of no confidence in the Government at the the “earliest opportunity when we can be confident of success”. Mr Corbyn would require a majority in Parliament to be successful, but the plot increases the likelihood of an imminent general election.

But his bid to become prime minister has hit another huge speed bump after experts launched yet another brutal attack against one of his key proposals should the Labour Party come into power.

The party released its ‘Land for the Many’ report in June, with one of the proposals suggesting setting up a Common Ground Trust.

This would act as a non-profit institution which Labour claimed could reduce the price of house buying by as much as 70 percent through effectively separating the ownership of land and property.

Labour said at a property buyer’s request, the Trust would buy the land underlying the house, making the upfront deposit for home ownership much more affordable.

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Jeremy Corbyn’s plans for domestic property sales have been attacked by experts (Image: GETTY)

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Jeremy Corbyn is ramping up the pressure on the current Government (Image: PA)

In return, the buyers would pay a land rent to the Trust. Labour claimed by bringing land into common ownership, land rents can be socialised rather than flowing to private landlords and banks.

Labour added this would allow people to put down much lower deposits and take on much lower mortgage debt than is currently the case, particularly in high land value areas.

The party said the new buyers would sign a lease that would make them members of the Trust, and entitle them to exclusive use of the land in return for paying a land rent. When moving house, “members would sell their bricks and mortar, while the Common Ground Trust would retain the title to the land.”

But these plans have been brutally torn apart but critics, who claim it is unaffordable and would force Labour to hike Britons’ taxes by tens of billions of pounds to pay for it.

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Boris Johnson is attempting to fight off intense pressure from the Labour Party (Image: GETTY)

If politicians want to reduce the cost of housing, they should focus on abolishing the hated stamp duty – not be coming up with ideas for yet more damaging land taxes

James Roberts

James Roberts, political director of the TaxPayers’ Alliance, told “Setting up a landlord quango to buy up property would mean massive borrowing and huge land rents to cover the short term costs. Capping land rents would mean borrowing even more, potentially billions of pounds.

“Taxpayers are facing a catch 22: new land taxes to live in your own home, or higher taxes across the board to pay for the UK’s new Government land baron.

“If politicians want to reduce the cost of housing, they should focus on abolishing the hated stamp duty – not be coming up with ideas for yet more damaging land taxes.”

Tim Focas, director of financial services at Westminster think tank Parliament Street, told the plan is already destined to fail.

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The Labour Party outlined a number of proposals in their ‘Land for the Many’ report (Image: GETTY)

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Jeremy Corbyn’s plans if Labour get into power have been ripped apart by experts (Image: PA)

He said: “This policy is about as clear as mud and has more holes in it than Swiss cheese. Labour would only be able to fund this plan through huge tax rises and increased borrowing.

“Its 2017 ‘fully costed manifesto’ already requires borrowing £250billion for an infrastructure fund over 10 years. That’s £25billion a year extra for further nationalisation. How do they propose going about funding this?

“Also, how on earth does a Labour government ensure profitability that gives enough for the tax payer to get a return, and to cut prices for customers? The answer is they can’t.

“Killing market forces and the ability of the private sector to generate much-needed housing has never been the answer to more affordable homes.”

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Is Labour Party leader Jeremy Corbyn a Eurosceptic? (Image: EXPRESS)

Matthew Lesh, head of research at the Adam Smith Institute thunk tank, also raged Mr Corbyn’s plan could cost taxpayers’ billions of pounds to fund.

“This policy reveals the insidious hatred of private ownership at the heart of Jeremy Corbyn’s Labour Party. Labour does not want you to have your own assets, to have your own stake in society.

“If people do not own the land under their home they will not be able to build up wealth, have something to leave to their children or an asset they can borrow against for entrepreneurial ventures.

“The Common Ground Trust is a nice name for a truly awful uncosted idea that’s designed to undermine the entire system of private ownership.

“It would involve paying land rents to the state for your entire life, never actually owning the land that lies under your house. This is just one small step away from nobody being allowed to actually to own their own home.

“Billions would have to be spent on this huge, unnecessary effort to buy up much of the country.”

boris johnson government

Boris Johnson’s Government faces the prospect of a no confidence vote within weeks (Image: GETTY)

Adam Cheal, founder and managing director of conveyancing firm Fletcher Longstaff told “As Labour are suggesting the “rent” on land will be much lower than the proportion of a mortgage payment to be used by a normal homebuyer to purchase the land component in a traditional purchase, the trust will end up with a huge deficit as it will still need to purchase land at market rates.

“This deficit will need to be funded by taxpayers making it unsustainable and unworkable in the longer term.

“The money would need to come from taxpayers, and in order for this to have much impact on house prices and bridge the gap between supply and demand, a major housebuilding programme delivering in excess of 100,000 extra homes each year would be required.

“This would cost tens of billions of pounds, money which the treasury doesn’t have.”

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