Labour could make move to introduce Mansion Tax in early budget

If Labour come to power in May then working on introducing the Mansion Tax would be a priority in order to supply extra funding for the NHS. In an interview with The Independent today, Ed Balls says that planning for the tax would begin on “day one” of a Labour Government. The Shadow Chancellor told the paper:

“Saving the NHS will be at the heart of our first Budget. I would like to see that revenue coming in in the first year of a Labour government, before the end of the financial year. We will have to see the practicalities.”

The desire to have revenue coming in before the end of the first year has led to speculation that Labour are planning for an early summer budget after the election, especially as he denies the need for retrospective legislation:

 “A charge is paid in that [financial] year on the valuation on a date in that year. We will be clear what we are going to do in our manifesto. No one will have any doubt about our intentions.”

“I am sure that the Treasury will be gearing up to make sure we can deliver this. As a backstop, we will legislate for the mansion tax to start in the following financial year, 2016-17.”

Meanwhile, the Office for National Statistics (ONS) have revised GDP figures today, showing the UK economy grew at a slower rate than had previously been thought: by 2.6% in the third quarter, rather than 3%. According to the BBC, it was also found that “the difference between the country’s export and import of goods and services at a record 6% of GDP.”

Shabana Mahmood, Labour Shadow Treasury Minister, reacted to the news saying:

“These are concerning figures. Growth has been revised down for five of the last six quarters, exports continue to disappoint and business investment fell in the last quarter. 

“The Chancellor has totally failed to rebalance the economy as he promised. And working people are still not feeling the recovery with wages sluggish and average earnings in real terms down £1600 a year since 2010. 

“Labour’s economic plan will ensure we earn our way to rising living standards for all, not just a few. Alongside sensible spending cuts and ensuring those with the broadest shoulders make a greater contribution, that’s the way to get the deficit down in a tough but balanced way.”