The introduction of a “mansion tax” has long been a Lib Dem aspiration. Nick Clegg, Vince Cable and other senior figures argue persuasively that Britain taxes income too heavily (the basic rate of tax, including National Insurance, is 32 per cent) and wealth too lightly. But a tax on high-value properties now seems less likely than ever. Asked about the subject on the Today programme this morning, Nick Clegg would only say “we will see what comes in future Budgets”. He spoke of his desire to capture “unearned wealth” but seemed to think that George Osborne was unlikely to act soon, if at all. The corollary of this is that the 50p tax rate is likely to remain for the duration of the parliament. The Lib Dems will not accept the abolition of the top rate unless it is replaced with some kind of wealth tax.
Clegg sounded more confident of action on tax avoidance, speaking of the possibility of a “general anti-avoidance rule”, a law that would require corporations to receive clearance from HM Revenue and Customs on their tax plans before implementing them. “I very much hope that we can make progress on that in the Budget,” he said.
Elsewhere in the interview, he attempted to bridge the coalition divide on Europe by emphasising that the government was united on the need to make the EU “more competitive”. But he damningly added that “no one planned for an outcome which left Britain in a position of one. There was no real planning or discussion about Britain being in a corner on its own.”
However, the former MEP also attempted to shed his image as an unthinking europhile. “I’m not a starry eyed pro-European,” he said, recalling that it took the EU 15 years to agree on a definition of chocolate.