New Scottish ‘mansion tax’ under fire from financial experts

While Scotland’s finance secretary says that anyone purchasing a property in the country that costs less than £325,000 will benefit from a new tax scheme, the new so-called ‘mansion tax’ has been criticised by financial experts for raising the price on the most expensive properties in Scotland, it was recently reported.

Finance secretary John Swinney told MSPs that a new tax-collecting agency in the planning stages especially for the administration of the new taxes, which go into effect from April of 2015.  Mr Swinney added that the stamp duty system is to be scrapped in order for it to be replaced by a new tax covering transactions of land and buildings instead; early analysis of one version of the plan could see anyone spending under that £325,000 on a new house would be subject to less taxation overall, but the possibility also exists that properties that cost anywhere from £208,000 to £250,000 could experience higher taxation rates on being purchased.

Mr Swinney insists that the lion’s share of homeowners would benefit from the new tax scheme. First-time buyers would stand to win big, the finance secretary added, though the new tax would increase amount of tax paid on the top 5 per cent of the most expensive homes and estates.

The change is being made in order to bring ‘more progressive’ forms of taxation, Mr Swinney said, in order to bring taxation levels better in line with the actual value of a piece of property. This new scheme will also benefit Her Majesty’s Revenue and Customs, as the new body he is proposing to take over the administration, to be called Revenue Scotland, would ease HMRC’s costs by about 25 per cent.

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