It would be nice to both have our cake and eat it, but alas that is rarely possible, and almost impossible, I suspect, in a political coalition. So I suppose we must swallow our frustration when Liberal Democrat leaders declare that the we are not ideological committed to the 50% tax rate (what's happened to the fairness agenda and all being in it together?) and accept its abolition in return a mansion tax. Indeed, there is a sense in which a shift away from taxes on income and towards taxes on assets, especially unearned ones, and including land and property and wealth, is to be welcomed
The main problem, if such a bargain is reached, will be to make sure that the Tories don't abolish the 50% rate now and then somehow wriggle out of the mansion tax at a later date. We've been out-manoeuvred in the past: let's hope our negotiators are moving up the learning curve.
When I asked Vince Cable, at the Liberal Democrat Birmingham Conference last September, why he advocated a new mansion tax rather than extra bands to the already existing and therefore more acceptable, though flawed, council tax, he dismissed the idea. It was therefore gratifying to hear him on the Today programme this morning concede that extra council tax bands are an alternative worth considering. Pity neither he nor his department bothered to answer my letter on this topic of last September (see post of 3rd October, http://keynesianliberal.blogspot.com/2011/10/mansion-tax-or-mor-council-tax-bands.html,)in spite of the Department's promise to do so within 15 days.