The only capital tax on first homes is stamp duty, but that recoups a tiny proportion of their value when averaged across the years of ownership. Remarkably, it is imposed on the buyer, not the seller.
Tax incidence George, tax incidence. that a tax is nominally imposed upon one person does not mean that they are bearing the economic burden of the tax.
Perhaps the most useful tax would be a levy on under-occupancy. In 2011 I proposed a kind of bedroom tax for the private sector: owners with two spare bedrooms or more should be subject to higher property taxes. This was after I stumbled across some buried government figures showing a 45% increase (to nearly 8m) in the number of under-occupied homes in England in just six years. An under-occupancy tax would encourage people either to sell houses that were bigger than they needed to families that could make better use of them, or to divide them, or to take in lodgers.
You can see it now, can’t you? Nope, only two bedrooms in this house. And this is the master dressing room, the study, the sewing room, the lady’s dressing room…..
The United Kingdom is remarkable in that it imposes no land value tax and no capital gains tax on principal residences; and charges council taxes that appear to be the most regressive major levies of any kind anywhere in western Europe.
And most of his complaints are about London. And do you know what else London has that most other European cities do not? A green belt. Abolish that and most of those problems will go away. After all, we all do actually know that it’s no more than a subsidy to those who own land inside it.